By Anna Stablum Oct. 2 (Bloomberg) -- Copper fell in London and headed for a fifth weekly drop, the longest losing streak in more than a year, as the dollar strengthened and rising inventories spurred concern that demand might be waning. The Dollar Index, a six-currency gauge of the greenback’s performance, closed in on a second weekly advance. That made dollar-priced metals more expensive for holders of other currencies. Stockpiles of copper in warehouses monitored by the LME posted a 12th weekly increase and have swelled by 34 percent since the week ended July 10. “Consumption levels are at a low ebb, as everything is pretty much slower, but this was masked by the weakness of the dollar throughout the summer,” Alex Heath, head of industrial- metals trading at RBC Capital Markets in London, said by phone today. “We are not seeing the appropriate pickup in either restocking or actual demand. Stocks are all going up, and it gives you the story that the markets are still oversupplied.” Copper for three-month delivery fell $52, or 0.9 percent, to $5,933 a metric ton on the London Metal Exchange at 10:45 a.m. local time. The contract has lost 1 percent this week. December-delivery copper shed 1.5 percent to $2.697 a pound on the New York Mercantile Exchange’s Comex division. U.S. Unemployment Manufacturing in China and the U.S., the world’s biggest copper users, expanded less than estimated by economists, reports showed yesterday. The Labor Department probably will say today the U.S. jobless rate rose to a 26-year high in September as employers kept cutting staff, according to economists, signaling consumers will not lead an economic recovery. “People have done the relief bit, they’ve done the enthusiastic ‘we are in recovery mood’ bit,” Heath said. “Now they are into the third act of the play -- how long is it going to take to get out of this mess?” Investors bought and sold 1,906 copper contracts in London, about 7 percent of yesterday’s total. Chinese markets were shut because of the National Day holiday, lasting until Oct. 8. “With the absence of China, it is not surprising that people don’t want to play and a lot of the bigger players are sidelined,” Heath said. “The metals are under pressure and are testing recent lows again.” The dollar strengthened to a three-week high against the euro as the prospect of slower global growth fueled demand for the safety of the yen and the U.S. currency. Europe’s single currency was poised for a second week of declines. Lead Drops The U.S. jobless figures are due at 1:30 p.m. London time. Unemployment likely climbed to 9.8 percent, and payrolls probably fell by 175,000 workers, according to a Bloomberg News survey of economists. Among other LME metals for three-month delivery, lead slid 4.1 percent to $2,100 a ton. The battery ingredient dropped as much as 5.5 percent to $2,070, the lowest level since Sept. 14. Prices gained 22 percent in August and September, helped by concern about closings of Chinese smelters linked to tougher enforcement of environmental regulations. “Lead got a big injection in the arm because of the smelter clampdown due to pollution restrictions in China,” RBC’s Heath said. “It got ahead of itself, and if it comes down lower, it just triggers more liquidation” Lead stockpiles monitored by the LME have almost tripled this year to 127,600 tons. Aluminum fell 1.4 percent to $1,833 a ton, and zinc shed 2 percent to $1,874 a ton. Nickel eased 0.3 percent to $17,375 a ton, and tin lost 0.5 percent to $14,125 a ton.

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