(Corrects to show zinc rose in last paragraph.)
Aug. 15 (Bloomberg) -- Copper futures dropped as signs of an improving U.S. labor market increased speculation that the Federal Reserve will curb debt purchases.
Claims for jobless benefits declined by 15,000 to 320,000 in the week ended Aug. 10, the fewest since October 2007, government data showed today. Copper has fallen 8.5 percent this year, partly on speculation that a reduction in the Fed’s $85 billion monthly bond-purchase program will slow expansion in the U.S., the world’s top metals consumer after China.
“Tapering is becoming a reality and is likely to start sooner rather than later,” Carlos Perez-Santalla, a New York- based broker at Marex North America LLC, said in a telephone interview. “People think that the market needs continued support from the Fed to gain traction.”
Copper futures for December delivery retreated 0.1 percent to settle at $3.3405 a pound at 1:21 p.m. on the Comex in New York.
Sixty-five percent of economists surveyed by Bloomberg predict that the central bank will opt to pare its stimulus program at a policy meeting next month.
Supply of mined copper is on track to gain 4 percent this year, double the 10-year average pace, Ryan Belshaw, an analyst at Macquarie Group Ltd., said in a report today. Total global inventory will expand to 3.3 million metric tons next year from 2.4 million tons now, he said.
On the London Metal Exchange, copper for delivery in three months fell 0.1 percent to $7,309 a ton ($3.32 a pound).
Nickel, tin and lead also slid, while aluminum and zinc rose in London.
--With assistance from Alfred Cang in Shanghai. Editors: Thomas Galatola, Millie Munshi