METALS-Copper steadies as Fed-driven rally fades, economy eyed
* Copper pauses as focus shifts to economy, euro zone * China on track for weakest full-year growth since 1999-poll * Japan 4Q aluminum premiums set at record $254-$255 * Coming up: U.S. August housing starts on Wednesday By Chris Kelly and Susan Thomas NEW YORK/LONDON, Sept 18 (Reuters) - Copper prices were little changed on Tuesday, edging higher in London and lower in New York after rallying last week to the highest levels since May on economic stimulus measures from the U.S. Federal Reserve and the European Central Bank. The rally has lost steam this week as investors digested the latest central bank stimulus plans, and shifted attention back the global economy and the outlook for physical metals demand. Investors remained particularly concerned about the euro zone, especially debt-laden Spain. These worries triggered some profit-taking in commodities and other assets perceived as risky. "The easing news is now behind us and people are refocusing on Europe and the macro picture, which don't look great. So we could see some of the gains (in metals prices) rolled back," said Edward Meir, analyst at INTL FCStone. COMEX copper for December delivery shed 0.50 cent to settle at $3,7870 per lb, backing further away from last Friday's 4-1/2-month peak at $3.8380. On the London Metal Exchange (LME), three-month copper edged up $17 to end at $8,319 a tonne. On Friday, it also rose to a 4-1/2-month peak at $8,411. Aside from the growth concerns in the United States and in Europe, investors also fear that sluggish demand from China, the world's top copper consumer, will remain in place for an extended period as the economy slows. China, which accounts for 40 percent of global refined demand for copper, is on course for its weakest full year of growth since 1999, with 2012 growth likely to fall below 8 percent, a Reuters poll showed. The poll showed pessimism deepening, partly reflecting disappointment at the lack of more urgent policy action to bring down the cost of credit. But any further monetary easing is unlikely to come before a once-a-decade change in the leadership of China's Communist Party, which may happen next month. Deutsche Bank analyst Daniel Brebner said for copper to break out of the ranges it has mostly traded in the past few months, the Chinese government would have to follow the lead of the Fed and be more aggressive in stimulating growth. "If that were to happen we would see a decent move higher," he said, but added that it was unlikely before the new government was in place, and possibly not until after the Chinese New Year early next year. Also weighing on prices was a drop in the euro to session lows against the dollar. A strong dollar makes commodities priced in the U.S. unit more expensive for holders of other currencies. ALUMINUM PREMIUMS FIRM In aluminum, fourth-quarter premiums to Japanese buyers, Asia's biggest importers of the metal, rose 24 percent from the previous quarter to a record high of $254-$255 a tonne as supplies remain tight, traders said on Tuesday. LME three-month aluminum ended down $7 at $2,160 a tonne. The LME price has fallen more than 10 percent since March, but premiums - money paid over the benchmark LME cash price to secure physical metal - have set record highs despite a global surplus due partly to large stocks locked up by banks in financing deals. Also reflecting a lack of available supply, the cost to roll nearby aluminum contracts soared to $15 on a tomorrow, next day delivery, basis, the highest since January, ahead of the September contract expiry this week. "Expect this week to see more consolidation in an effort to wear off the overbought situation, as well as to test the resolve of the weak longs," RBC said in a research note. Metal Prices at 1805 GMT Metal Last Change Pct Move End 2011 Ytd Pct move COMEX Cu 378.45 -0.75 -0.20 343.60 10.14 LME Alum 2159.00 -8.00 -0.37 2020.00 6.88 LME Cu 8318.00 16.00 +0.19 7600.00 9.45 LME Lead 2274.00 9.00 +0.40 2035.00 11.74 LME Nickel 17810.00 -410.00 -2.25 18710.00 -4.81 LME Tin 21595.00 20.00 +0.09 19200.00 12.47 LME Zinc 2107.50 18.50 +0.89 1845.00 14.23 SHFE Alu 15765.00 -70.00 -0.44 15845.00 -0.50 SHFE Cu* 59590.00 -180.00 -0.30 55360.00 7.64 SHFE Zin 15620.00 -95.00 -0.60 14795.00 5.58 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07
DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.