LONDON: Copper fell on Monday on disappointment over a lack of progress in solving the euro zone crisis and fears that top commodities consumer China will step up a campaign to curb inflation in the metals-intensive housing sector. Comments from German Chancellor Angela Merkel, supporting European Central Bank efforts to address the euro zone crisis, had helped lift risk sentiment on Friday, boosting prices of base metals. But any optimism that flowed from those remarks soon faded as euro zone leaders failed to follow up with any concrete plans at the weekend. In China, the world's top consumer of copper, home prices ticked up in July from June, a second month of modest rises that raised the risk Beijing may seek to ratchet up a two-year campaign to curb housing inflation. Commodities markets were also disappointed that China, which accounts for 40 per cent of the world's copper demand, held off on much hoped for monetary easing last weekend. "The focus of the market is back on Europe and China," said Standard Bank analyst Leon Westgate. "The housing data on the surface suggests that property controls are going to continue. In Europe, we've got a week of shuttle diplomacy and a lot of talking but not much action." Three-month copper on the London Metal Exchange was down 1 per cent at $7,457 per tonne by 1005 GMT, after rising 1.2 per cent on Friday. Copper open interest , or contracts that are 'live' - having not yet come to expiry or closed out, is languishing at the lowest level in around five years. Volumes were slim, with around at 5,403 lots of copper changing hands. LME copper, which has dropped more than 27 per cent from a record of $10,190 in February 2011, has been stuck in a narrow trading range between $7,300 and $7,600 since July 20. To break out of the range, "you really need something to entice the guys on the sidelines to come in. What you needs is a significant improvement or deterioration", Westgate said. "At the moment it's status quo, drifting along." SUPPLY On the supply side, output from the world's largest copper mine, Chile's Escondida, rose 18 per cent in the first half of the year, compared with the same period last year. This was partly due to better ore grades. The euro fell as the dollar recouped losses against a basket of currencies, making commodities priced in the U.S. unit more expensive for holders of other currencies. In other metals, three-month aluminium fell 0.9 per cent to $1,840.25 from $1,858 at the close on Friday. The price of the metal has fallen around 20 per cent since March. Aluminium producers outside of China, the world's largest producer of the metal, have been cutting production to counter a drop in aluminium prices, but traders said this may do little to bolster the price if other countries such as India seek to make up for the production shortfall this year. India's aluminium exports could rise 5 per cent in the current fiscal year to 325,000 tonnes despite a slowdown in global demand, a senior industry official said. Three-month zinc lost 0.7 per cent to $1,783 from $1,796 at the close on Friday, lead was down 0.7 per cent at $1,881 from $1,895, tin was down 0.1 per cent at $18,475 from $18,495 and nickel fell 1.2 per cent to $15,443 from $15,630.

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