China, whose economy trails only that of the U.S. for size in the world, reduced its annual economic growth target from the 8 percent at which it had sat for about seven years. Premier Wen Jiabao reduced the target to 7.5 percent. The price of the reddish metal also slipped as a consequence of car sale projections in China during January and February of 2012 falling to their lowest in seven years.
The Asian nation "is not growing quite as fast as it was, and that's taking some of the steam out of the market," partner William O'Neill with Logic Advisors in New Jersey told the news service. "People are concerned about the level of Chinese inventories."
At 11:50 a.m. on Monday, copper futures dropped 0.82 percent, a 3.2 cent slip to $3.871 per pound.
The reddish metal is sensitive to economic and financial developments throughout the world due to its myriad uses in manufacturing, construction and additional industries. Those developments are especially underscored when they apply to China, which also is the globe's top consumer of copper.
Prior to Monday's trading session, the industrial metal had climbed 14 percent in 2012, according to Bloomberg.
Gross domestic product in China during the final quarter of last year developed at an 8.9 percent rate, which one analyst noted could signal the Asian nation's economy is pulling back.
"The Chinese economy may well continue to slow noticeably," states a note penned by analyst Leon Westgate with Standard Bank, according to Dow Jones Newswires. "Against that economic backdrop, Chinese consumers may also look to further delay any purchasing decisions."
China consumes roughly 40 percent of the globe's supply of copper and, with the sovereign debt crisis ravaging banks, markets and public finance systems in the euro zone, another analyst said the price of metals is being pinched.
Laggardly economic activity in the 17-nation bloc is pulling down the price of copper, states a note authored by analyst Edward Meir with INTL FCStone.
"Metals demand in China is decelerating," states the note by Meir.
And in the euro zone, the purchasing managers' index fell lower than 50, which signals economic contraction. Results of the PMI were 49.3, which were lower than the 49.7 that was forecast by economists, according to Dow Jones Newswires.
Reuters reports the price of copper futures dropped more than 1 percent at one point on Monday, a surprise development considering the industrial metal's uptick thus far this year. The strong performance of copper thus far is largely attributable to larger amounts of liquidity throughout markets worldwide as central banks work on enhancing development and growth.
But China's pullback also is attributable to the nation's goal of providing wiggle room should it need to slow down.
"In many respects they're readjusting market (expectations) away from the fixations on the 8 percent (growth) figure. They're trying to engineer a soft landing and so far they're on track," analyst Tom Kendall with Credit Suisse told Reuters. "The market is in a wait-and-see mode. As far as Chinese real demand goes the level of activity post Chinese hasn't been that strong so we are going to be broadly (trading) sideways for a little while longer."
But in the U.S., the only economy larger than China, growth hastened last month to its most rapid pace in 12 months, according to Reuters.
The news source reports that development is contrary to the plight of the economy of the euro zone, which appears to be barreling toward an economic recession.
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