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Copper rose in London on speculation that a slumping dollar will encourage buyers holding other currencies to purchase the metal. Lead and nickel advanced.

The U.S. currency dropped to an all-time low against the euro after a government report showed that the U.S. economy grew last quarter at the slowest pace in four years. A change in the dollar’s value makes copper, traded in dollars, more or less expensive for buyers using other currencies.

“Today’s move is a reaction to the dollar weakness,” Daniel Vaught, a commodity analyst at A.G. Edwards in St. Louis, said today. “The GDP report was pretty disappointing to a lot of people and as a consequence the dollar has slumped.”

Copper for delivery in three months on the London Metal Exchange gained $101, or 1.3 percent, to $7,760 a ton as of 5:32 p.m. local time. A close at that price would cap a 2.5 percent decline this week.

The dollar was as weak as $1.3681 per euro today. U.S. gross domestic production grew at an annual rate of 1.3 percent in the quarter after a 2.5 percent pace in the previous period, the Commerce Department said today.

The metal used in construction and piping snapped seven consecutive weeks of gains in London on speculation demand growth will slow due to rising supply in China, the world’s largest user of the metal.

China Demand

Stockpiles monitored by the Shanghai Futures Exchange rose to 67,820 metric tons, the highest since December 2005, according to exchange data released today. That may slow imports into the nation this quarter, said Tobias Merath, an analyst at Credit Suisse Group in Zurich.

“China is well-supplied with the metal,” Merath said in a telephone interview. “Copper will fall in the next three months to around $7,400 a ton.”

The metal has gained 22 percent this year as China increased imports in the first quarter. Higher prices may slow second- quarter demand, according to analysts including Li Zhifeng at China Minmetals Nonferrous Metals Co.

Copper inventories monitored by the LME fell 1.3 percent to 159,125 tons, the lowest since Dec. 1, the exchange said today.

Housing data from the U.S., the world’s second-largest user of the metal, indicated demand may slow. Single-family housing starts will fall to 1.16 million this year, the lowest since 1.13 million in 1997, the National Association of Home Builders said yesterday in Washington.

U.S. copper use fell 21 percent in January from a year ago, the Lisbon-based International Copper Study Group said April 24.

China’s financial markets including the Shanghai exchange will be closed from May 1 to May 7 for the Labor Day holiday.

The holiday “presents an opportunity for investors in London and New York to ramp up prices in thin trading positions,” John Kemp, an analyst at Sempra Metals Ltd. in London, said today in a report.

Nickel, Lead

Nickel, used in stainless steel, may surpass this year’s record of $50,200 a ton as supplies lag behind demand, Standard Bank Plc’s analyst Mike Skinner said in an interview yesterday in Mumbai. The metal price may rise above $55,000, he said.

Nickel gained the most in more than three weeks, climbing $1,700, or 3.6 percent, to $48,700 a ton. A close at the level would be a flat result for the week. Earlier, the contract rose as much as 5.1 percent, the biggest intraday gain since April 3.

Lead rose $49.50, or 2.5 percent, to $2,010 a ton. On April 24, Barclays Capital analysts led by Kevin Norrish in London raised their 2007 average lead-price forecast to $1,847 a ton, from $1,634. “Lead fundamentals are arguably the strongest of any base metal at present” due to supply disruptions, the analysts said.

Ivernia Inc., which accounts for 3 percent of the world’s lead-mine supplies, has halted exports at the Australian port of Esperance since March 12 following an investigation into lead poisoning. The Toronto-based company said today it submitted a plan to ship ore stranded at the port.

Also on the LME, tin gained $300 to $13,300 a ton, aluminum added $44 to $2,854 and zinc slipped $35 to $3,675.

Information from: www.bloomberg.com