NEW YORK—Copper futures are picking up Friday morning after softer-than-expected December jobs data that may point to low U.S. interest rates for a longer period than some had been thinking, enabling investment money to continue flowing to the metal.
In recent trading, benchmark March copper was up 1.7 cents at $3.4440 a pound on the Comex division of the New York Mercantile Exchange. The metal has erased slight losses; it was down 1.15 cents before the data.
Nonfarm payrolls fell by 85,000 last month, compared with a revised 4,000 gain in November, the Labor Department said Friday. Economists surveyed by Dow Jones Newswires had expected a payroll decrease of just 10,000. The November figure originally showed an 11,000 drop in payrolls.
The unemployment rate remained at 10% in December, the same level as the previous month. Economists had forecast the jobless rate would edge higher to 10.1%.
The dollar dropped against its major rivals after the data. The lower-than-expected numbers could cause investors to believe U.S. interest rates will remain very low for a longer time. That would weigh on the dollar and boost commodities, likely keeping intact trade where investors sell the buck and buy riskier assets.
Also, dollar-denominated assets like copper often trade inversely to the greenback because dollar movements make them more or less expensive for those using other currencies.
Copper had been under slight pressure before the payrolls data on lingering concerns over China's policy shift toward monetary tightening and the potential for a winter-weather related demand slump in the Asian nation.
"Concerns over further monetary tightening measures from the People's Bank of China continue to weigh on sentiment, while fears over the potential impact that the bad weather in China may have on metals demand are also a factor," said Standard Bank analyst Leon Westgate.
Inventory gains were also pressuring the metal, MF Global analyst Edward Meir said.
Inventories of copper stored in London Metal Exchange-monitored warehouses rose 3,150 metric tons Friday, leaving them at 510,625. Once-a-week data released on Fridays by the Shanghai Futures Exchange showed a weekly rise of 3,499 metric tons to 98,814.
The most recent Comex inventory data, released late Thursday afternoon, were unchanged at 99,368 short tons.
