Copper Drops for First Time in Five Days on Fiscal Cliff Concern
Copper fell for the first time in five days as the dollar extended gains against the euro on concern U.S. budget talks made little progress. Metals retreated.
The contract for delivery in three months fell 0.5 percent to $7,769 a metric ton on the London Metal Exchange at 4:48 p.m. in Tokyo. The metal touched $7,828.75 yesterday, the most expensive since Nov. 2.
Senate Majority Leader Harry Reid told reporters he was disappointed with the lack of progress in congressional budget talks. Concern about the fiscal cliff of $607 billion in tax increases and spending cuts overshadowed data showing demand for capital goods increased, while home prices and consumer confidence rose.
“Concern over the U.S. fiscal cliff was the key factor that weighed on metals,” said Hwang Il Doo, a senior trader at Korea Exchange Bank Futures Co. in Seoul. “Positive U.S. economic data was lending support, limiting a further drop.”
Reid said Republicans backed away from earlier openness to considering new tax revenue. The Congressional Budget Office has said the economy could fall into a recession if a deal isn’t struck to avoid more the tax increases and spending cuts that come into effect should Congress fail to agree on a budget.
March futures declined 0.4 percent to $3.523 a pound on the Comex in New York. Futures for March delivery closed little changed at 56,180 yuan ($9,022) a ton on the Shanghai Futures Exchange.
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