Copper Falls Most in Three Weeks as Metals Drop on Fed
Copper fell by the most in two weeks, paring a weekly gain, as industrial metals dropped after U.S. Federal Reserve policy makers said they will probably end their $85 billion monthly bond-purchase program sometime this year.
Copper for delivery in three months on the London Metal Exchange lost as much as 1.3 percent to $8,058 a metric ton, the most since Dec. 20, and was at $8,070 at 1:19 p.m. in Shanghai, paring a second straight weekly advance to 2.3 percent. Futures on the Comex in New York fell 1.1 percent to $3.6750 a pound.
Federal Open Market Committee minutes released yesterday for a Dec. 11-12 meeting showed members who provided estimates were “approximately evenly divided” between those who said it would be appropriate to end the purchases around mid-2013 and those who said should continue beyond that date. The Dollar Index gained as much as 0.4 percent to 80.672 today.
“The Fed minutes have become the market concern,” Xiong Dabiao, an analyst at Minmetals Futures Co., said by phone from Shanghai. “One of the main reasons why commodities prices have remained high in recent years is a relatively weak dollar, so if that changes, we may need to reassess reasonable price levels.”
April futures on the Shanghai Futures Exchange gained 0.8 percent to 58,330 yuan ($9,361) a ton after closing for three holidays. On the LME, aluminum, zinc, lead, nickel and tin declined for a second day.
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