Copper (COMEX:HGN14) advanced for a ninth straight session in New York, capping the longest rally since 2005, amid signs of tightening supply.
Inventories monitored by exchanges in London, Shanghai and New York fell for the 10th trading day in a row, and are at the lowest since October 2008. Copper also rose after the dollar slid, as a report showing the U.S. economy shrank more in the first quarter than economists estimated boosted demand for alternative assets.
“With the level of stockpiles that we have, copper prices should get another leg higher,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “The weaker dollar naturally supports prices.”
Copper futures for delivery in September gained 0.7 percent to settle at $3.166 a pound at 1:14 p.m. on the Comex in New York. The rally was the longest since June 2005.
On the London Metal Exchange, copper for delivery in three months rose 0.4 percent to $6,915 a metric ton ($3.14 a pound).
U.S. gross domestic product fell at a 2.9 percent annualized rate in the first quarter, the worst reading since the same three months in 2009, government figures showed. Economists surveyed by Bloomberg projected a 1.8 percent drop.
The U.S. is the world’s largest copper consumer after China.
Global inventories at warehouses tracked by the three main exchanges have declined 51 percent this year. Stockpiles monitored by the LME fell 0.6 percent today, extending a slump to the lowest since August 2008.
Aluminum, nickel and zinc advanced in London, while tin and lead declined.