BS: Copper Climbs to One-Week High as Weaker Dollar Spurs Demand
Aug. 17 (Bloomberg) -- Copper climbed to the highest price in a week after a drop in the dollar boosted demand from buyers seeking alternative assets.
The greenback fell for a second day, losing as much as 0.6 percent against a basket of six currencies. Copper prices also gained today as inventories monitored by the London Metal Exchange sank to the lowest level since Nov. 13. Before today, the metal lost 1.4 percent this year on signs of a slowing global economy.
“Copper is moving on the dollar,” said Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago. “Industrial metals are getting some stabilization on the fact that demand still looks like it didn’t fall off the face of the earth.”
Copper futures for December delivery added 5.5 cents, or 1.7 percent, to $3.3555 a pound at 9:16 a.m. on the Comex in New York. Earlier, the price touched $3.358, the highest level for a most-active contract since Aug. 10.
Traders shrugged off a report that showed U.S. housing starts rose less than forecast in July and building permits fell to the lowest level in more than a year. Construction accounts for a quarter of all copper demand, according the Copper Development Association.
“Copper is a bellwether, and the fact that it is holding up is a good sign” for the economy, McGhee said. “It is acting as a leader rather than a follower.”
On the London Metal Exchange, copper futures for delivery in three months added $116, or 1.6 percent, to $7,366 a metric ton ($3.34 a pound).
Aluminum, zinc, lead, tin and nickel prices also gained.
--Editors: Michael Arndt, Steve Stroth.
To contact the reporter on this story: Millie Munshi in New York at mmunshi@bloomberg.net
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
