Copper fell from a three-week high as Chinese inflation turned out to be weaker than analysts expected. This news concerned investors who believe that the flagging inflation data may indicate weakening demand for copper in China, the largest importer of the red metal.
According to Bloomberg, copper for delivery in December fell 0.8 percent to $3.0665 a pound at 7:27 a.m. on the Comex in New York. Prices reached the highest level since Sept. 19 yesterday. The contract for delivery in three months declined 0.6 percent to $6,757 a metric ton on the London Metal Exchange.
"The inflation number is very, very low. It seems the demand side is much weaker than we expected," said Tetsu Emori, a senior fund manager at Astmax Asset Management Inc. in Tokyo, to Bloomberg on Wednesday.
Fears of an economic slowdown in China were compounded by declining manufacturing activity in the New York region, Binary Tribune reported. The Federal Reserve Bank of New York reported that NY Empire State Manufacturing Index dropped to 6.17 in October from 27.54 a month earlier, trailing projections for a moderate drop to 20.50. By this measure, business conditions in the region are as weak as they've been since April.
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