US copper futures settled firmer but off their best levels on Friday as investors were seen squaring their books at the month's end, although the backdrop of bullish supply constraints should continue to fuel the upside next week, sources said.
"Just some end-of-the-month book squaring today. The underlying fundamentals that have boosted this market to the recent record highs are still mostly in place, with the latest being the strike in Chile," said one broker at a New York trading house.
Copper for July delivery ended the day up 3.95 cents, or 1.24 percent, at $3.2205 a lb on the New York Mercantile Exchange's COMEX division, moving between $3.17 and $3.29.
Spot May gained 7.55 cents at $3.3355, but was still down from the Wednesday all-time record at $3.50 a lb, based on a spot continuation. COMEX final copper volume was estimated at 16,000 lots, against the 18,261 lots recorded on Thursday.
On Thursday, a surprise move by China's central bank to raise interest rates by 30 basis points caught the metals markets off guard, pressuring copper down 4 percent at the close.
"Too much was made of this story, we think, as a 30 basis point rate increase will hardly do much to dent growth in an economy expanding at a sizzling 10 percent per year," Edward Meir, metals analyst with Man Financial said.
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