New York/London - Copper prices closed at a 2-1/2-month low on Friday, after surprisingly strong U.S. economic data failed to halt the bearish impact this week from a stronger dollar and tighter monetary policy in China.
Prices of the metal, which is used in construction and power, suffered their worst monthly losses since December 2008.
Benchmark copper for March delivery on the New York Mercantile Exchange's COMEX division ended down 4.55 cents at $3.0525 per lb, its lowest level on a closing basis since mid-November. The session range spanned $3.0490 to $3.1540. After the close, further selling dragged prices down to a low of $3.0360.
On the London Metal Exchange, copper for three-month delivery shed $140 to finish at $6,750 a tonne, another settlement low dating back to the middle of November.
The U.S. economy grew at a faster-than-expected 5.7 percent in the fourth quarter, the quickest pace in more than six years, the Commerce Department said earlier.
Adam Klopfenstein, senior market strategist at MF Global Ltd's Lind-Waldock division in Chicago, said the surprisingly strong growth figures gave copper an initial jolt higher, but the market's recent bearish tone prevailed.
"There's counter-acting forces at play - the overall optimism in the economy from the GDP numbers and the Chinese news flows that are dominating sentiment," he said.
Investors remain worried that China's move on January 12 to raise domestic banks' reserve requirement ratio could be a possible precursor to rate hikes.
China is the world's largest metals consumer.
Additional weight was seen from the dollar, which rallied versus the euro on the GDP figures and separate data showing surprisingly strong consumer sentiment and business activity in the U.S. Midwest.
A stronger dollar makes dollar-priced metals more expensive for non-U.S. investors.
Copper prices have fallen around 9 percent this month, weighed by concern over market regulation in the United States, monetary policy in China and continued gains in LME stocks.
The latest data showed LME copper stocks rose 875 tonnes to total 541,050 - a near one-year high.
Aluminum hit $2,069 a tonne, its lowest since December 1, and ended at $2,080, versus $2,108 Thursday. LME stocks of the metal, used in transport and packaging, fell 7,225 tonnes but remained near record levels above 4.6 million tonnes.
A recent rise in canceled warrants in base metals - material earmarked for delivery - has helped support prices at the lower levels. On Thursday, aluminum canceled warrants were 246,800 tonnes compared with 215,975 tonnes on Dec. 17.
Steel making ingredient nickel ended at $18,500, up from $18,350, while battery material lead ended at $2,020, down from $2,055, having earlier hit its lowest level since late August at $2,010.
LME nickel stocks hit another record, rising 1,290 tonnes to 164,808 tonnes, but prices were being supported by worries over upcoming labor contract talks at Xstrata's Sudbury nickel-copper operations in Canada.
Zinc ended at $2,110 a tonne, down from $2,158, and tin was at $17,200, down from $17,550, having earlier hit a near one-month low at $16,750. Zinc, used to galvanize steel, earlier touched $2,097, its lowest since Oct. 19.
Metal Prices at 2013 GMT Metal Last Change Pct Move End 2009 Ytd Pct
move COMEX Cu 303.85 -5.95 -1.92 334.65 -9.20 LME Alum 2091.00 -17.00 -0.81 2230.00 -6.23 LME Cu 6738.25 -151.75 -2.20 7375.00 -8.63 LME Lead 2029.00 -26.00 -1.27 2432.00 -16.57 LME Nickel 18600.00 250.00 +1.36 18525.00 +0.40 LME Tin 16999.00 -551.00 -3.14 16950.00 +0.29 LME Zinc 2130.00 -28.00 -1.30 2560.00 -16.80 SHFE Alu 16040.00 -265.00 -1.63 17160.00 -6.53 SHFE Cu* 55430.00 -2050.00 -3.57 59900.00 -7.46 SHFE Zin 17395.00 -940.00 -5.13 21195.00 -17.93 * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07 - Reuters
