Copper fluctuated in London, rising on speculation that the Federal Reserve may take more steps to spur U.S. economic growth before sliding as the dollar strengthened. Copper added as much as 0.8 percent after Fed Chairman Ben S. Bernanke said purchases of Treasury securities by the central bank are possible beyond the $600 billion announced last month. The U.S. Dollar Index, a six-currency gauge of the greenback’s strength, gained as much as 0.5 percent, making metals priced in the currency more expensive in terms of other monies. “The whole market is dollar-watching, really,” Alex Heath, head of industrial-metals trading at Royal Bank of Canada Europe Ltd. in London, said by e-mail. Copper for delivery in three months gained $4 to $8,729 a metric ton at 10:26 a.m. on the London Metal Exchange. Copper for delivery in March fell 0.3 percent to $3.986 a pound on the Comex in New York. U.S. unemployment may take five years to fall to a normal level, Bernanke said in an interview broadcast yesterday by CBS Corp.’s “60 Minutes” program. The unemployment rate rose to a seven-month high of 9.8 percent in November as payroll growth slowed to 39,000 from 172,000, Labor Department figures showed on Dec. 3. Mine Strike Copper also had gained as a month-long strike continued at the world’s third-biggest mine and inventories tracked by the LME headed for a 42nd weekly contraction in a row. There’s “a lot of positive news around,” said Robin Bhar, an analyst at Credit Agricole SA’s investment-banking unit in London, citing expectations for further so-called quantitative easing by the Fed, positive economic data and new investment allocations into metals. “Risk appetite has returned in quite a big way over the last week or so.” Wage talks at Anglo American Plc and Xstrata Plc’s Collahuasi mine in Chile will continue today after union and company representatives failed yesterday to reach agreement in a seventh day of talks. Copper inventories tracked by the LME fell to 352,375 tons, daily exchange figures showed. Stockpiles have slid 30 percent this year, heading for the first annual decline since 2004 and contributing to copper’s 18 percent gain in 2010. Inventories monitored by the Shanghai Futures Exchange fell last week for a second week. $11,250 a Ton “Increased demand and low inventories will likely push copper to a new record of $11,250 a ton in 2011,” Bank of America Merrill Lynch said in a report dated Dec. 3. Immediate-delivery LME copper’s premium to three-month metal was last up 12 percent at $47 a ton. The gap reached $74, the widest in two years, on Dec. 1. One unidentified company held between 50 percent and 79 percent of LME copper stockpiles from Nov. 22 through to Dec. 1, the latest exchange data show. JPMorgan holds the metal, the Daily Telegraph reported. Brian Marchiony, a London-based spokesman for JPMorgan declined to comment. J.P. Morgan Physical Copper Trust will hold only so-called grade-A copper and not futures, the bank said in an Oct. 22 filing to the Securities and Exchange Commission. Under LME rules, a firm holding 50 percent to 79 percent of deliverable stockpiles must lend the metal to buyers at no more than 0.5 percent of the cash price for a day. Tin for three-month delivery on the LME was unchanged at $25,550 a ton. Prices reached a record $27,500 on Nov. 9. The metal has jumped 51 percent this year, leading advances on the exchange, after production was disrupted in Indonesia and the Democratic Republic of Congo. Aluminum fell 0.3 percent to $2,312 a ton and nickel declined 0.4 percent to $23,400 a ton. Lead gained 0.2 percent to $2,345 a ton and zinc was little changed at $2,220 a ton. To contact the reporter on this story: Maria Kolesnikova in Moscow at mkolesnikova@bloomberg.net

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