Copper futures fell for the first time in three days on signs that that the economy may expand less than the government forecast in China, the world’s biggest consumer of industrial metals.
Economic growth as low as 6.5 percent may be tolerable in the future, Chinese Finance Minister Lou Jiwei said yesterday. He expressed confidence that expansion will be 7 percent this year after the government set a goal of 7.5 percent in March. Figures on the gross domestic product are due on July 15, and GDP will weaken for the ninth time in 10 quarters. according to analysts surveyed by Bloomberg
“This is a rather sobering assessment from a senior policy maker,” Edward Meir, an analyst at INTL FCStone in New York, said in a report. “For now, we would rather be on the sidelines and watch to see where things settle in light of key macro announcements that will come out this weekend.”
Copper futures for September delivery declined 0.7 percent to settle at $3.155 a pound at 1:13 p.m. on the Comex in New York. The price jumped 3.7 percent in the previous two days, partly on speculation that China and the U.S. will maintain policies on economic stimulus.
In the second quarter, China’s economy probably expanded 7.5 percent from a year earlier, down from 7.7 percent in the prior three months, the Bloomberg survey showed. Macquarie Group Ltd. reduced its estimates for growth this year to 7.3 percent and 6.9 percent in 2014.
Copper dropped today as the dollar rebounded against a basket of 10 currencies, eroding demand for commodities as an alternative investment.
On the London Metal Exchange, copper for delivery in three months slid 0.7 percent to $6,954 a ton ($3.15 a pound).
This week, the price climbed 2.4 percent, the most in two months. Stockpiles monitored by the LME declined 2.9 percent, the biggest drop since October.
Lead fell in London, while zinc, tin, aluminum and nickel rose.
To contact the editor responsible for this story: Steve Stroth at email@example.com