Copper fell in Asia as the dollar rose against the euro ahead of a report that will probably show a deepening recession in the 16 nations that use the common currency, reducing demand for commodities as an alternative asset. The metal tumbled 54 percent last year, the most since at least 1987, as the financial crisis pushed the U.S., Europe and Japan into recession and as China’s growth slowed. Global inventories of the metal, used in electrical wiring and pipes, gained to near a five-year high. Copper advanced 5.3 percent on Dec. 31. “We saw some window dressing on the last day, so it’s not unexpected to see the markets give up some of those gains as the fundamental picture hasn’t changed overnight,” said Jiang Mingjun, an analyst at Shanghai Oriental Futures Co. London Metal Exchange copper fell as much as 1.5 percent to $3,025 a metric ton before trading at $3,035 at 12:49 p.m. Singapore time. March-delivery copper on the Comex division of the New York Mercantile Exchange slipped 1.9 percent to $1.3835 a pound. Shanghai’s markets are closed for holidays today. “For at least the first quarter, we’re still going to see higher inventory levels and lower prices,” Jiang said. “Movements in the U.S. dollar will also continue to drive the entire commodities complex and hence copper prices.” London Metal Exchange warehouse stockpiles rose to 339,775 tons Dec. 31, the highest since February 2004 and 72 percent more than at the start of the year. The dollar was at $1.3863 per euro from $1.4045 late in New York yesterday. Europe’s manufacturing index was 34.5 in December, unchanged from a preliminary estimate and the lowest since the data was introduced in 1998, according to economists surveyed by Bloomberg News. The index is based on a survey of purchasing managers by Markit Economics and a figure below 50 indicates contraction. The report will be released at 9 a.m. in London.

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