July 16 (Bloomberg) -- Aluminum prices rose to a 16-month high as stockpiles tracked by the London Metal Exchange slumped amid signs of accelerating economic growth in China, the world’s biggest user of industrial metals.
China’s gross domestic product rose 7.5 percent in the second quarter from a year earlier, topping the 7.4 percent estimate of analysts. In the U.S., confidence among homebuilders rose to the highest in six months. Aluminum, used in construction, autos and cans, has climbed 9.4 percent this year as LME inventories dropped to a 22-month low.
“Some of the numbers we’ve seen out of China and the U.S. are pretty good, and they’re supportive of the metals complex as a whole,” Mike Dragosits, a senior commodity strategist at TD Securities in Toronto, said in a telephone interview. “The market is probably a bit worried about supply tightness in aluminum in the near term.”
Aluminum for delivery in three months rose 0.5 percent to close at $1,970 a metric ton at 5:50 p.m. on the LME. Earlier, the price touched $1,993, the highest since March 13, 2013. Stockpiles fell for the 11th straight session to 4.98 million tons, the lowest since Sept. 13, 2012.
Copper fell 0.7 percent to $7,078 a ton ($3.21 a pound) in London. Earlier, the price touched $7,051.25, the lowest since July 2.
Rio Tinto Group boosted its full-year forecast for production from mines by 2.6 percent to 585,000 tons on higher output in Mongolia and the U.S.
Zinc rose, while nickel, lead and tin declined.
On the Comex in New York, copper futures for September delivery dropped 1.1 percent to $3.2145 a pound, the biggest decline for a most-active contract since June 6.