Copper Drops As Lower Demand Expected

Copper fell in New York as economists projected lower factory orders in the U.S., the second-biggest consumer of the metal, and the dollar remained near the highest level in more than four years.

Factory orders slid 9.5 percent in August, according to a Bloomberg survey of economists before data today. The dollar closed Sept. 30 at the highest level since June 2010 against a 10-currency basket. A stronger greenback makes dollar-priced raw materials more expensive in terms of other monies.

“While broader financial markets are still under pressure, I’d hesitate to call a bottom to any of the commodity markets,” Nic Brown, head of commodities research at Natixis SA in London, said by e-mail.

Futures for December delivery lost 0.8 percent to $3.012 a pound by 8:34 a.m. on the Comex in New York. Copper for delivery in three months fell 0.3 percent to $6,662 a metric ton on the London Metal Exchange.

Employers in the U.S. added 215,000 jobs in September, a Bloomberg survey showed before data tomorrow, up from 142,000 in the prior month.

“Payrolls data could help improve the tone, but we might have to wait until China is back from its week-long holiday before we see whether base-metal markets have found a base,” Brown said. The Asian nation is the largest copper user.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza