Copper prices fell the most in two weeks as the Federal Reserve starts a policy meeting projected to result in a further cut for economic stimulus.
The U.S. central bank will end its two-day gathering tomorrow. A “tapering announcement could be bullish for the dollar, but bearish for copper,” Naeem Aslam, chief market analyst at Ava Capital Markets Ltd. in Dublin, said by e-mail today. Copper climbed 2.3 percent in the previous three weeks partly as exchange-monitored inventories declined.
“We are neutral on the base-metal markets for the moment and suspect that after several weeks of steady gains, we may be in store for a period of consolidation,” Edward Meir, an analyst at INTL FCStone in New York, said in an e-mailed note today.
Copper futures for delivery in July fell 0.6 percent to settle at $3.073 a pound at 1:20 p.m. on the Comex in New York, the biggest drop for a most-active contract since April 15.
The Fed is forecast to cut its monthly asset purchases by $10 billion to $45 billion tomorrow, according to economists surveyed by Bloomberg. The U.S. is the world’s biggest copper consumer after China.
On the London Metal Exchange, copper for delivery in three months slid 0.5 percent to $6,715 a metric ton ($3.05 a pound).
Stockpiles monitored by the LME, down 36 percent this year, declined for a sixth session to 235,075 tons, the lowest since October 2012.
Nickel for delivery in three months fell 0.1 percent to $18,150 a ton in London. Prices jumped 31 percent this year, partly as the U.S. and Europe levied sanctions against Russia for its intervention in Ukraine.
Vladimir Potanin, the billionaire who runs Russia’s OAO GMK Norilsk Nickel, said concerns that supplies of the metal will be disrupted by sanctions against the country over the crisis in Ukraine are overstated.
Aluminum, zinc, tin and lead also fell in London.