"The risks [of a hard landing] are rising quite dramatically based on what we're seeing in base metals," Mr Bird says. "The house view is still that we are going into a soft landing," he adds. "But the weakness in US metals is more than just a short, sharp inventory adjustment."

Historically, a reduction in metals prices has sometimes served as a timely warning that industrial production was about to slow down. In the last two economic downturns - in 1994 and 1998 - metals prices started falling sharply several months before Organization for Economic Cooperation and Development industrial production began declining, according to a study compiled by ABN Amro. In two previous downturns - in 1979 and 1987 - industrial production fell before metals prices were affected.

"Metal prices are an indicator of some sort," says Thames River Capital's hedge-fund manager Martin Taylor. "But whether they're an indicator of leading trends or concur rent trends is not clear," he adds.

Regardless, analysts say growth in demand for aluminum and copper has fallen sharply recently, particularly in North America. A Macquarie Bank report says that U.S.-based Commonwealth Industries Inc. shipped only 106,000 metric tons of aluminum in the third quarter, 12.7% less than a year earlier. The report also says that Commonwealth estimates aluminum shipments will fall an additional 10% to 15%, in the fourth quarter due to slowing demand. The report also says that Alcan Aluminum Ltd, Montreal, said sector-wide aluminum shipments fell 3.1 per cent in the third quarter.

Copper is used to make the wires laid down in new buildings and electronic circuitry. A downturn in demand for copper is often seen as a sign of a coming slowdown in the construction or electronics sector. Aluminum is used for packaging and automobiles. Analysts say a slowdown in demand for aluminum can indicate rising automobile inventories and falling demand for new cars.

Analysts disagree, however, over what the recent metal price movements says about global economic trends. "Our concerns over the outlook have grown in the last few weeks," says Mr Naqvi. "There is no doubt that demand is weakening from very strong levels. The real question is whether this weakening will continue or whether this is just a temporary correction."In a related development, economists at Morgan Stanley have raised their estimate of the likelihood of a hard landing to 40 per cent, up from the 10 per cent probability they were giving it only 10 weeks ago. "The risks are rising that the ending is going to be a lot rougher than most of us are predicting," says Morgan Stanley's senior economist Stephen Roach. Metal price movements "are one indicator of that," he adds.

Mr Roach defines the "hard landing" scenario as global growth of less than 2.5 per cent and a recession in the US. At present, he adds, Morgan Stanley still predicts that the global economy will grow 3.9 per cent next year, but he says turmoil in the Middle East could lead to an oil shock that might shave a point or two off the current consensus estimates.