Sept. 11 (Bloomberg) -- Copper futures fell for the second straight day as concern that the Federal Reserve will start scaling back U.S. fiscal stimulus next week outweighed signs of an economic rebound in China.
Fed policy makers meet for two days starting Sept. 17, and will probably cut monthly bond purchases by $10 billion, according to economists in a Bloomberg survey published on Sept. 6. A report on Sept. 13 may show retail sales rose at a faster pace in August, adding to signs of the recovery, another survey showed. Earlier, copper gained as much as 0.6 percent after banks boosted forecasts for China’s economy.
“As we get closer to the Fed meeting, the taper fears increase,” Bill O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview. “We’ve had a spate of solid Chinese data, but the market hasn’t done much with it. The Fed meeting may be a tipping point.”
Copper futures for December delivery dropped 0.2 percent to settle at $3.257 a pound at 1:14 p.m. on the Comex in New York. The metal fell 0.5 percent yesterday. China’s is the world’s biggest user, followed by the U.S.
China’s economy will expand 7.6 percent this year, up from a forecast of 7.5 percent, UBS AG said today. Deutsche Bank AG boosted projections for the third and fourth quarters and raised its outlook for 2014. The country’s broadest measure of new credit almost doubled in August from July, the central bank said yesterday, while separate figures showed industrial production gained the most in 17 months.
“We’re seeing some positive signs out of China, and that’s putting a floor under prices,” David Meger, the director of metal trading at Vision Financial Markets in Chicago, said in a telephone interview.
Copper has gained 6.5 percent in the third quarter.
On the London Metal Exchange, copper for delivery in three months was unchanged at $7,170 a metric ton ($3.25 a pound). Aluminum and nickel gained, while tin, lead and zinc fell.
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