Copper dropped to a two-week low as Germany’s economy slowed and U.S. lawmakers struggled to reach an agreement to raise the nation’s borrowing limit.
Manufacturing in the New York region contracted for a sixth straight month in January and German growth slowed more than expected last year, separate reports today showed. President Barack Obama said at a White House news conference yesterday that he won’t negotiate over raising the debt ceiling, warning of economic calamity if Congress fails to increase the $16.4 trillion limit.
“There are economic concerns moving forward with the debt- ceiling issue, and markets came under pressure after Obama’s speech,” David Meger, the director of metal trading at Vision Financial Markets in Chicago, said in a telephone interview. “Anything tilting toward economic uncertainty is going to weigh on copper.”
Copper futures for delivery in March lost 0.2 percent to $3.6255 a pound at 11:08 a.m. on the Comex in New York after touching $3.606, the lowest since Dec. 31.
Since 1960, Congress has raised or revised the debt limit 79 times, including 49 times under Republican presidents, according to the Treasury Department.
The Federal Reserve Bank of New York’s general economic index fell to minus 7.8. Readings below zero signal contraction. Germany grew at a 0.7 percent pace last year, down from 3 percent in 2011, the nation’s statistics office said.
Prices also slid after Rio Tinto Group’s production of mined copper topped analyst estimates, indicating ample supply.
Stockpiles monitored by the London Metal Exchange rose 1.1 percent to 333,275 metric tons, the highest since Jan. 27.
On the LME, copper for delivery in three months fell 0.3 percent to $7,972 a metric ton ($3.62 a pound). Nickel, zinc and lead also slid in London. Aluminum was little changed, while tin rose.
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