Copper, little changed, may drop as Fitch Ratings’ warning that it may downgrade Italy’s credit rating raised concern over Europe’s economic growth, eroding demand prospects for industrial metals.

The three month contract on the London Metal Exchange fell as much as 1.3% to USD 7,642.25 a metric tonne and traded at USD 7,750 by 4:16 p.m. Tokyo time. The March delivery contract gained 0.3% to USD3.522 a pound on the Comex.

Italy faces a significant chance of a credit rating downgrade by Fitch Ratings, which is reviewing all European sovereign ratings and will make a decision by the end of the month. The euro weakened versus the dollar before a report that may signal Europe’s debt crisis is hurting the region’s prospects for economic growth. The euro lost as much as 0.4% to USD 1.2729.

Mr Hwang Il Doo a senior trader at Korea Exchange Bank Futures Co in Seoul said that “The market was under pressure from the European headline that made the euro weaken against the dollar.”

(Sourced from Bloomberg)