Copper slipped on Friday as investors downgraded expectations of a global economic and demand recovery, while aluminium inventories edged ever closer to the unparalleled four million tonne level. Three-month copper MCU3 on the London Metal Exchange traded down at $4,350 a tonne in official rings from $4,445 at the close on Thursday when the metal used in power and construction hit a two-week low of $4,315 a tonne. Expectations of an imminent economic and industrial metals demand recovery were hit by German data which showed a record 3.8 percent plunge in gross domestic product for the first quarter. [ID:nLF269827][ID:nLF520964] "The German data was a lot worse than consensus was expecting," said David Wilson, director of metals research at Societe Generale. "Germany is very export dependant ... It indicates that we're not in recovery yet." He added that as the seasonally slow summer period for metals consumption approaches, there is a concern that China's recent stockpiling may start to fade. Stocks of copper in LME warehouses fell 12,850 tonnes to 357,800 tonnes to their lowest level since early January. Since January, copper prices have risen by about 40 percent with much of the optimism built on perceived demand from China, the world's largest consumer of the red metal. But Chinese government and consumer buying for stocks is expected to end soon, if it has not already. Recent rises in cancelled warrants -- material earmarked for delivery -- was proof of Chinese stockpiling, analysts said. But on Thursday, cancelled warrants fell to 61,300 tonnes or 17 percent of total LME stocks, from 72,525 tonnes the day before. "Strong Chinese buying has been the foundation for this rally," Barclays Capital said in a note. "But we suspect that this process has now largely run its course."

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