Copper futures settled slightly higher on Thursday as the dollar weakened and fears of an economic recession grew.
Fed Chairman Bern Bernanke signaled today that more interests rate cuts would be necessary because the economic outlook in U.S. has worsened, according to testimony he gave to a a congressional committee today.
Earlier Thursday, copper declined on reports that U.S. home construction fell.
Copper futures for March delivery settled 95 cents higher to $3.1820 a pound on the New York Mercantile ExchangeÂ´s COMEX division. The highest price today reached $3.2460.
Thursday's Commerce Department report showed home construction projects started in December fell 14.2 percent. This was their lowest level in 16 years. According to the report, construction projects started in 2007 declined 25 percent, the most since 1980.
U.S. is the second largest consumer of copper in the world. Copper is used mainly for housing and manufacturing..
Inventories of copper stored in London Metal Exchange warehouses dropped 5,500 metric tons to 185,550 metric tons. Of those, 162,000 metric tons are available to the market. This is the fourth day of losses for copper this week.
Copper for delivery in three months settled at $7,000, down $160from Wednesday's closing level at the London Mercantile Exchange.