Copper lower on US economic data

Copper prices were lower Friday after the US Commerce Department reported that the nation’s gross domestic product contracted by 6.2 percent on an annualized basis in the fourth quarter.

In addition, consumer spending fell at by 4.3 percent last quarter, while Deutsche Bank (FWB: DBK; NYSE: DB) predicted that the price of copper will average $1.275 per pound this year, well below last year’s average.

These reports were taken together as signs that the recession is getting worse, which renewed concerns that demand for copper could continue to decline.

May copper was down 4 cents to $1.54 per pound in New York trade, while three-month copper on the London Metal Exchange dropped $60 to $3,440 per tonne, $5,500 per tonne below its peak price in early July 2008.

Precious metals prices were mixed as silver and platinum saw gains but gold dropped 10 cents to $942.50 per troy ounce in New York after going as high as $964 per troy ounce earlier in the session.

Gains for the US dollar reduced demand for gold as a safe investment.

May silver added 14 cents to $13.11 per troy ounce while April platinum gained $33.20 to $1,083.70 per troy ounce.