Copper fell from a four-month high in New York on renewed concern that the global recession will curb demand for the metal used in pipes and wires. Inventories monitored by the London Metal Exchange jumped 2.1 percent today, the most in a month, to 503,950 metric tons. European industrial production dropped 17 percent in January, the most since at least 1986. Copper plunged 54 percent last year as the widening recession slashed consumption and stockpiles climbed. “The global economic system is still not out of the woods yet,” Edward Meir, an analyst at MF Global Ltd. in Darien, Connecticut, said in a report today. “We think copper is overdone at current levels and due for a pullback.” Copper futures for May delivery fell 1.15 cents, or 0.6 percent, to $1.796 a pound on the New York Mercantile Exchange’s Comex division. Still, the price earlier touched $1.853, the highest for a most-active contract since Nov. 10. Even after today’s decline, the metal ended the week up 7.9 percent, mostly because of speculation that investors will boost raw-material purchases as a hedge against inflation. The Federal Reserve said March 18 it may buy more than $1 trillion in government and mortgage debt to help end the recession, stoking inflation concerns. The dollar is headed for a 4.8 percent decline against the euro this week. The Reuters/Jefferies CRB Index of 19 commodities rose for a second day, reaching the highest since Feb. 9. Inflation Protection “The key to this week has been the Fed announcement,” said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. “They’re cranking up the old printing press, so a lot of people are buying up commodities to protect against future inflation.” On the LME, copper for delivery in three months dropped $49, or 1.2 percent, to $3,950 a ton ($1.79 a pound). The price reached a record $8,940 on July 2. Copper “picked up on the expectation of demand receiving a speedy boost from the spending plans,” analysts at Societe Generale said in a report today. “However, the near-term fundamentals continue to paint a negative picture across the base-metals spectrum, suggesting sentiment is running ahead of reality.” The price will average $3,600 a ton this year, Societe Generale forecasts.

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