Copper rose above $4,000 a metric ton for the first time since November in London, gaining with other metals as a Federal Reserve plan to buy bonds pulled the dollar lower and fueled speculation about an economic recovery. The U.S. Dollar Index, which measures the greenback against six other currencies, dropped as much as 2 percent, extending yesterday’s 2.7 percent retreat. Aluminum advanced to the highest in five weeks. “All markets are significantly higher, largely because of the impact of the Fed announcement last night, and the dollar is very weak,” Alex Heath, head of industrial metals trading at RBC Capital Markets in London, said today by telephone. Copper for three-month delivery rose $209, or 5.6 percent, to $3,965 a metric ton at 2:06 p.m. on the London Metal Exchange. The contract climbed as high as $4,020 a ton, the highest intraday price since Nov. 10. The metal has added 29 percent in 2009, rebounding from last year’s 54 percent plunge. Fed officials voted yesterday to buy as much as $1.15 trillion of assets to help revive the world’s biggest economy. The U.S. is the second-largest copper and aluminum consumer after China. The dollar index fell for an eighth straight day today and has lost 6.6 percent since closing on March 9. In technical terms, copper would have to close for two days above $3,840 a ton for prices to move to around $4,190, the next so-called resistance level, Edward Meir, an analyst at MF Global in Darien, Connecticut, wrote in a report. Brief Rally? “However, we would advise caution at these levels and would not be chasing the current bounce, as we think the market has done too much, too soon, given the still-daunting macro backdrop,” he wrote. The metal, used in plumbing and electrical wiring, is unlikely to sustain its rally because the gain is based on expectations that the Fed plan will kick-start the U.S. economy rather than any actual revival, said Robin Bhar, an analyst at Credit Agricole SA’s Calyon unit in London. “It may well do, but I think we are talking months, not hours or days,” he said. “We are in completely unknown waters.” Copper inventories in LME-monitored warehouses fell 0.3 percent to 493,450 tons, extending their decline since Feb. 25 to about 10 percent. Canceled warrants, or metal earmarked for delivery, fell 825 tons to 22,650 tons and now account for 4.6 percent of total inventories, down from 12 percent on March 4. Aluminum for three-month delivery gained $56, or 4.1 percent, to $1,435 a ton after reaching $1,446, the highest intraday price since Feb. 9. LME-monitored stockpiles of the lightweight metal climbed to a record 3.45 million tons and have more than tripled in the past year. Lead added $45, or 3.5 percent, to $1,335 a ton, taking this year’s advance to 34 percent. Nickel rose 2.5 percent to $10,125 a ton, zinc gained 4.8 percent to $1,247.25 a ton, and tin climbed 6.1 percent to $10,475 a ton.

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