Copper Declines to One-Week Low as Slowing Economies May Cut Into Demand

Copper fell to a one-week low in London on speculation slumping economies will reduce demand.
An index of investor confidence in the euro region declined to a two-year low this month, Limburg, Germany Sentix said today. The MSCI World (MXWO) Index of shares fell 2.1 percent today.
“It’s more just the feeling that the macro outlook is weaker,” Jim Lennon, global head of commodities research at Macquarie Group Ltd. in London, said by phone.
Copper for three-month delivery declined $116, or 1.3 percent, to $8,960 a metric ton on the London Metal Exchange, the lowest closing price since Aug. 24. Copper for December delivery dropped 6.35 percent, or 1.5 percent, to $4.061 a pound on the Comex in New York by 6:40 p.m. in London.
Prices fell after German Chancellor Angela Merkel’s party suffered its fifth election loss this year following a campaign based on her handling of the euro-area debt crisis. Germany’s top constitutional court will rule on Sept. 7 in three cases challenging the country’s participation in a bailout of Greece and the euro-area rescue fund.
“Focus this week is likely to switch to the EU debt situation again as Germany’s government is voting on the EU bailout fund,” William Adams, an analyst at Basemetals.com in London, wrote in a report.
Stronger Dollar
Metals also declined as the U.S. Dollar Index headed for its longest winning streak since January, making dollar-priced commodities more expensive in terms of other monies.
Nickel for three-month delivery on the LME led declines among the six main metals traded on the exchange, falling 2.8 percent to $20,895 a ton. Zinc retreated 1.1 percent to $2,172 a ton, the lowest settlement since Aug. 22.
Aluminum dropped 2 percent to $2,387.50 a ton, lead slid 1 percent to $2,435 a ton and tin fell 1.2 percent to $23,950 a ton.