Copper Rises as Retail Sales Report Signals Economic Growth
New York, May 14 (Bloomberg) -- Copper rose to a two-week
high as a report of a larger-than-expected gain in U.S. retail
sales improved prospects for an economic resurgence that would
boost demand for metals.
The 1.2 percent rise in April sales reported by the Commerce
Department was the biggest since October. The report reinforced
expectations for continued growth of the U.S. economy, which
expanded in the first quarter at the fastest pace in two years.
``We need better economic conditions to improve copper
demand, and it is possible that the economy will improve better
than expected in the second quarter,'' said Jim Steel, vice
president of commodity research at Refco Inc. in New York.
Copper for July delivery rose as much as 0.6 cent, or 0.8
percent, to 74.35 cents a pound on the Comex division of the New
York Mercantile Exchange, the highest price since April 29. Prices
have risen 23 percent from a 14-year low in November as the U.S.
economy recovered from last year's recession. They still were 1.5
percent lower than a year earlier.
In London, copper for delivery in three months rose as much
as $10.50, or 0.7 percent, to $1,620 a metric ton (73.48 cents a
pound) on the London Metal Exchange.
The gain in retail sales reported by the Commerce Department
was larger than the 0.6 percent increase expected by economists in
a Bloomberg survey.
Sales at auto dealers and auto-parts stores rose 1.9 percent,
also the largest increase since October. An average automobile
contains about 50 pounds of copper, according to the New York-
based Copper Development Association.
Stores that sell building materials, including copper wire
and pipes, saw sales rise 2.7 percent, following a 1.7 percent
gain in March, the report showed.
Builders are the largest users of copper and steady demand
for new homes in the U.S. last year helped buoy prices for the
metal during the recession.
--Claudia Carpenter in the New York newsroom (212) 318-2346 or at
ccarpenter2@bloomberg.net with reporting by Monee Fields-White in
Washington. Editor: Bixby |
