(15/04) Copper prices down on higher inventories, China inflation

April 15, 2011

Copper prices were lower again Thursday on more concerns about inflation in China and as inventories continue to grow.

May copper was a cent lower to $4.28 per pound in New York trade, while three-month contracts were down $105 to $9,410 per tonne on the London Metal Exchange.

Media reports said that it is likely inflation was up as much as 5.4 percent in China in March over the same month last year, and investors worried that if the reported figure turns out to be accurate, it could lead to more monetary policy tightening that could hurt demand for copper in the Asian nation.

Inventories of copper in warehouses monitored by the LME added another 875 tonnes during the session to their highest levels since last June, while gains in US producer prices in March also hurt prices.
Precious metals prices, however, were higher in New York trade, helped by a weaker US dollar and by concerns about European debt problems and on the US news on producer prices and a Labor Department report that showed first-time claims for unemployment benefits in the US were up by 27,000 last week.