Debarati Roy is a reporter with Bloomberg News
Copper futures climbed for a second straight day in New York after U.S. service industries expanded at a faster pace in January, bolstering expectations for demand.
Services are the biggest part of the economy in the U.S, the world’s second-largest metals user. Volatility in copper has climbed this year as traders weigh the outlook for improving American expansion against signs of a slowdown in Asia and Europe. Prices earlier fell as much as 1 percent on concern that a cut in the reserve ratio won’t be enough to revive growth in China, the top consumer.
The Institute for Supply Management’s non-manufacturing index rose to 56.7 from a six-month low of 56.5 in December, the group said Wednesday. U.S. automakers reported their best January sales in nine years. The Copper Development Association estimates the average American car uses about 50 pounds (23 kilograms) of the metal.
“The ISM number and strong automobile data out of the U.S. are supporting copper prices,” George Gero, a New York-based precious-metal strategist at RBC Capital Markets LLC, said in a telephone interview. “We are seeing some interest at these low prices.”
In New York, copper futures for March delivery climbed 0.4 percent to settle at $2.591 a pound at 1:07 p.m. on the Comex. Prices touched a five-year low of $2.419 on Jan. 26 amid Chinese demand concerns.
Copper for delivery in three months rose 0.3 percent to $5,705 a metric ton ($2.59 a pound) on the London Metal Exchange.
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