Investing.com - Copper prices fell more than 1% on Thursday, amid expectations that the Federal Reserve could start to push up interest rates sooner than expected and as ongoing fears over China''s slowing economy continued to weigh.
On the Comex division of the New York Mercantile Exchange, copper futures for May delivery fell to a session low of $2.938 a pound, before paring losses to last trade at $2.944 a pound during European morning hours, down 1.43%, or 4.3 cents.
The industrial metal fell to $2.877 a pound on Wednesday, the lowest since July 2010, before turning higher to settle at $2.987, up 1.2%, or 3.5 cents.
Futures were likely to find support at $2.877 a pound, the low from March 19 and resistance at $2.998 a pound, the high from March 19.
The Fed said Wednesday that it would reduce its monthly bond buying program by an additional $10 billion to a total of $55 billion a month, in a widely anticipated decision.
Equities sold off and the dollar rallied after Fed Chair Janet Yellen indicated that the central bank could begin to raise interest rates about six months after the bond-buying program winds up, which is expected to happen this fall.
The central bank also updated its forward guidance, discarding the 6.5% unemployment threshold for considering when to increase borrowing costs and said it will look at a wide range of information.
Meanwhile, growing indications the Chinese economy could be running out of steam dampened the appeal of growth-linked assets.
Wall Street investment bank Goldman Sachs downgraded its gross domestic product growth forecast for China, saying the world''s second largest economy faces a "bumpy road ahead."
The bank lowered its 2014 forecast to 7.3% from 7.6% on Wednesday. It also cut its 2015 outlook to 7.6% from 7.8%.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere on the Comex, gold for April delivery fell 0.72%, or $9.60, to trade at $1,331.70 a troy ounce, while silver for May delivery lost 2.29%, or 47.6 cents, to trade at $20.35 an ounce.
Market players looked ahead to key U.S. data later in the day to further gauge the strength of the economy.
The U.S. is to publish the weekly report on initial jobless claims, as well as data on existing home sales and manufacturing activity in the Philadelphia region.