Copper futures capped the biggest decline in more than a week on demand concerns amid signs that housing markets are sputtering in China and the U.S., the two biggest users.
New-home prices dropped in 68 of the state-tracked 70 cities in August from July, China’s statistics bureau said today. That was the most since January 2011, when the government changed the way it compiles the data. Real estate accounts for 50 percent of the nation’s copper use, Goldman Sachs Group Inc. estimates. Beginning home construction in the U.S. fell 14 percent, adding to indications of an uneven housing recovery.
Prices of copper fell because of “a confluence of factors between poor figures from the U.S. and China,” Graham Leighton, a trader at Marex Spectron Group in New York, said by phone.
Copper for December delivery retreated 1.6 percent to settle at $3.094 a pound at 1:13 p.m. on the Comex in New York. The loss was the biggest since Sept. 9.
Prices declined 0.7 percent yesterday as signs of low U.S. inflation cut demand for commodities as a store of value. The Federal Reserve raised the estimate for its benchmark interest rate to 1.375 percent at the end of 2015 from 1.125 percent in June, and today the dollar touched the highest since 2010 against a basket of 10 currencies. Gains by the dollar reduce the appeal of raw materials as an alternative investment.
On the London Metal Exchange, copper for delivery in three months slid 1.3 percent to $6,842.50 a metric ton ($3.10 a pound).
Aluminum, nickel and lead also dropped in London, while tin and zinc rose.
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