IV:Copper futures fall to 2-week low on global demand concerns
Investing.com - Copper futures fell to a two-week low on Thursday, amid ongoing concerns over global economic growth prospects, which in turn have triggered worries over global copper demand.
On the Comex division of the New York Mercantile Exchange, copper futures for July delivery traded at USD3.238 a pound during European morning trade, down 0.8% on the day.
New York-traded copper prices fell by as much as 0.9% earlier in the session to hit a daily low of USD3.235 a pound, the weakest level since May 3.
Official data on Wednesday showed that the euro zone economy contracted by 0.2% in the first quarter, bringing the annualized rate of contraction to 0.9%.
Germany’s economy posted growth of 0.1%, below expectations for a 0.3% increase, while the French economy contracted by a larger than expected 0.2%.
Europe as a region is third in global demand for the industrial metal and worries over its economic growth have kept copper prices under pressure in recent weeks.
Meanwhile, in the U.S., data showed that industrial production fell by 0.5% in April, more than forecasts for a 0.2% drop.
A regional manufacturing barometer in the U.S. disappointed as well.
The Federal Reserve Bank of New York's Empire State manufacturing index slid to minus 1.4 in May, from a reading of 3.1, disappointing expectations for a rise to 4.0.
The U.S. is second behind China in global copper demand and manufacturing numbers are used as indicators for future demand growth.
A broadly stronger U.S. dollar also weighed. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.2% to trade at 84.08.
On Wednesday, the gauge hit 84.22, the highest level since July, after a string of disappointing economic indicators in the U.S. and Europe sparked safe-haven demand for the liquid greenback.
Copper prices typically weaken when the U.S. currency strengthens as the dollar-priced commodity becomes more expensive for holders of other currencies.
Elsewhere on the Comex, gold for June delivery tumbled 1.9% to trade at USD1,370.05 a troy ounce, while silver for July delivery plunged 2.3% to trade at USD22.13 a troy ounce.
