Copper lower on consumption forecast

Copper prices were lower Monday on forecasts that consumption will drop this year and after an industry report showed that sentiment among US homebuilders remained low in March.

Sydney, Australia-based Macquarie Group (ASX: MQG)  forecast that consumption of copper, which is used heavily in construction, will drop by 9.2 percent this year.

May copper was 4 cents lower to $1.96 per pound in New York, while three-month copper dropped to $4,266.50 per tonne in late afternoon trade on the London Metal Exchange.

Precious metals were also lower.

June gold dropped $24.50 to $872.80 per troy ounce in New York trade on lower demand as sentiment improved on the chance that the US economy will strengthen soon.

The decline came after comments late last week from Federal Reserve Chairman Ben Bernanke, who said that efforts by the Fed to free up credit are seeing success.

Meanwhile, May silver was down 63 cents to $12.11 per troy ounce.