BLBG:Copper Slumps From One-Month High as Chinese Interest Rates Rise
Copper fell from a one-month high in London after surging interest rates in China undermined the outlook for demand in the world’s biggest consumer of the metal.
The benchmark money-market rate jumped the most since July as China’s central bank refrained from adding funds to markets. Prices also slumped after the nation’s banks tripled the amount of bad loans written off in the first half and data yesterday showed employers in the U.S. hired fewer workers last month than estimated by economists in a Bloomberg survey.
“The reported bad debt in Chinese banks might give the market some pressure,” Richard Fu, director for Asian commodity trading at Newedge Group SA in London, said by e-mail. The U.S. is the second-largest copper user.
Copper for delivery in three months lost 0.9 percent to $7,264 a metric ton by 10:14 a.m. on the London Metal Exchange. Prices touched $7,350 yesterday, the highest level since Sept. 20. Copper for delivery in December fell 0.9 percent to $3.306 a pound on the Comex in New York.
Chinese authorities may tighten policy this year if inflation quickens, Song Guoqing, an academic adviser to the central bank, said Oct. 20. Consumer prices rose the most since February last month and house prices in four major cities jumped the most since January 2011.
Supply of refined copper trailed demand by 93,000 tons in 2013’s first seven months, narrowing from a 552,000-ton shortage a year earlier, the International Copper Study Group said.
Copper stockpiles monitored by the LME, at the lowest since March, fell for a 35th session to 489,400 tons, daily exchange data showed. Orders to remove the metal from warehouses gained 8.4 percent to 274,200 tons, driven by a 48 percent surge to a record 73,725 tons in New Orleans, the world’s biggest repository for LME copper inventories.
Nickel for delivery in three months on the LME dropped 0.9 percent to $14,719 a ton after climbing 6 percent over the prior three sessions, the most in 10 weeks, according to data compiled by Bloomberg. Aluminum, tin, lead and zinc fell.
To contact the reporter on this story: Agnieszka Troszkiewicz in London at atroszkiewic@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
