* Euro rebounds after Germany softens on Greece * U.S. economy recovery worries weigh on dollar * LME zinc falls on unwinding of arbitrage trades (Updates prices, adds quotes and details) By Carrie Ho SHANGHAI, May 31 (Reuters) - London copper was steady amid thin trading on Monday, supported by a firmer euro after a report said Germany could make concessions on efforts to put together a bailout for Greece. London Metal Exchange copper for delivery in three months fell 0.4 percent to $9,161.50 by 0409 GMT, paring some losses earlier in the morning when it fell 0.6 percent to a low of $9,140.25. The most-active August copper contract on the Shanghai Futures Exchange SCFcv1 rose 0.3 percent to 68,350 yuan per tonne by its midday close. "The euro has an influence on copper's movements today. Overall, LME copper is in a stable situation. Trading volumes are low after the long holiday. It opened weaker but there have been some buying since then. So the Shanghai market is stable today as well," a Shanghai-based trader said. The euro hit a three-week high against the dollar after a wave of short-covering was triggered by a report saying Germany was considering dropping its push for an early rescheduling of Greek bonds in order to facilitate a new package of aid loans for Greece. [ID:nL3E7GV0AU] The dollar's appeal was undermined by weak data on Friday that prompted questions on whether the U.S. economic recovery was faltering, raising expectations that authorities may keep interest rates at near zero well into 2012.[ID:nN27109401] [ID:nN27296561] The greenback was down about half a percent against a basket of currencies. A weaker dollar makes commodities cheaper for holders of other currencies. Zinc fell 0.9 percent to $2,255.75 on the LME but edged up 0.09 percent to 17,285 yuan on the ShFE SZNcv1. The Shanghai-based trader said LME zinc's weakness was due to the unwinding of arbitrage trades made before. "A while ago, there have been quite a bit of arbitrage trading where investors bought zinc on LME and sold it on ShFE. This could be the unwinding of those positions. Also, LME zinc tends to rally during European trading hours and trade more weakly during Asian hours," he added. LME tin was the biggest loser, falling 0.9 percent to $27,270. Its volatility was due to very thin trading with only 7 lots traded. Base metals prices at 0409 GMT Metal Last Change Pct Move YTD pct chg LME Cu 9161.50 -37.50 -0.41 -4.57 SHFE CU FUT AUG1 68350 210 +0.31 -4.87 LME Alum 2624.00 -1.00 -0.04 6.23 SHFE AL FUT AUG1 16805 55 +0.33 -0.21 HG COPPER JUL1 415.85 -4.45 -0.66 -6.33 LME Zinc 2255.75 -19.25 -0.85 -8.08 SHFE ZN FUT AUG1 17285 15 +0.09 -11.25 LME Nickel 23100.00 10.00 +0.04 -6.67 LME Lead 2505.00 0.00 +0.00 -1.76 SHFE PB FUT 17095 55 +0.32 -6.84 LME Tin 27270.00 -230.00 -0.84 1.38 LME/Shanghai arb 1120 Shanghai and COMEX contracts show most active months ^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE third month Shanghai lead launched on March 24 (Additional reporting by Nick Trevethan in SINGAPORE,; Editing by Himani Sarkar)

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