Copper fell in London from yesterday’s seven-month high on gains by the dollar and speculation that prices no longer reflect demand after a five- month rally. The Dollar Index, a measure of the greenback against the euro and five other currencies, rose as much as 0.8 percent, increasing the cost of dollar-denominated commodities for holders of other monies. Copper for three-month delivery has jumped 63 percent this year on the London Metal Exchange, helped by optimism about a rebound in the world economy. “A firmer dollar is weighing on metals,” Eliane Tanner, an analyst at Credit Suisse Group AG, said by phone from Zurich. “We are still a bit skeptical about the latest recovery in prices, which was mainly fueled by an improvement in risk appetite, as demand is still very weak.” Three-month copper slid $56, or 1.1 percent, to $4994 a metric ton on the LME by 12:16 p.m. local time, erasing a gain of as much as 1.3 percent. Copper futures for July delivery fell 0.7 percent to $2.2820 a pound on the New York Mercantile Exchange’s Comex division. LME copper climbed as high as $5,145 a ton yesterday, the highest intraday price since Oct. 15, as a report on sales of previously owned U.S. houses fueled speculation about a rebound by the world’s biggest economy. The construction industry uses a quarter of all copper produced, according to the Copper Development Association. ‘Uncertain’ Outlook Copper may reverse recent gains in the next nine months because of an “uncertain” outlook, according to Rio Tinto Group, the world’s third-biggest mining company and owner of stakes in the two largest copper mines. Higher prices have “not necessarily been supported” by demand, Bret Clayton, chief executive officer of Rio Tinto Copper, said yesterday at a conference in London. The company is still “bullish” on the outlook for the metal over three to five years, he said, citing supply constraints and a lack of new discoveries. Among other LME metals for three-month delivery, aluminum rose 0.1 percent to $1,473 a ton. Gayle Berry, an analyst at Barclays Capital in London, cited increased consumer buying of the lightweight metal in recent weeks. “You are seeing car producers and can producers all doing pretty decent volumes of hedging,” she said. Trimet Aluminium AG, Germany’s largest producer of the metal, started increasing production last month on expectations that demand will rebound. “We are going back to two-thirds of production due to consumer demand,” said Chief Executive Officer Heinz-Peter Schlueter yesterday. ‘End of De-Stocking’ In nations belonging to the Organization for Economic Co- operation and Development, “we are beginning to see an end of the de-stocking process that has been going on for a very, very long time,” Berry said. “We have hit a bottom, and we are going to see an improvement.” Still, re-stocking in the OECD won’t make up for a decline in Chinese import demand, she said. China’s demand for aluminum may fall 3 percent this year to 12.2 million tons, while output may decline 5 percent to 12.9 million tons, Paul Robinson, manager of non-ferrous metals at CRU International, said today at a conference in Shanghai. Nickel slid 1.2 percent to $14,440 a ton after reaching $14,800, the highest intraday price since Oct. 6. Lead lost 1.9 percent to $1,627 a ton after rising as high as $1,677.50, the highest intraday price since Oct. 7. Zinc fell 1.5 percent to $1,557 a ton, and tin was unchanged at $14,500 a ton.

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