RTRS:METALS-Copper rises as dollar falls, ECB meeting in focus
* China could cut interest rates - media
* Dollar falls against basket of currencies
* Coming up: European Central Bank rate decision; 1145 GMT
By Susan Thomas
LONDON, June 6 (Reuters) - Copper rose on Wednesday on a weaker dollar and
as the euro and global shares rose ahead of a meeting of the European Central
Bank that may offer measures to ease the euro zone debt crisis.
Investors were also hopeful that big metals consumer China will cut interest
rates soon after an official newspaper urged Beijing to take more steps to shore
up China's economy.
"There is a bit of calm so far this morning, but I think probably because
the market has been closed for two days and people are trying to assess if
anything has changed since Friday," said Societe Generale analyst Robin Bhar.
"My simple answer is 'No'."
Three-month copper on the London Metal Exchange rose 0.9 percent to
$7,424 a tonne by 1039 GMT, resuming trade after a two-day holiday in the United
Kingdom.
"China is slowing and the market is expecting more announcements on cuts to
interest rates or some kind of stimulus," Bhar said. "But markets are still
highly vulnerable because of the debt crisis in Europe."
Official and HSBC PMI surveys in China last week signalled a
deeper-than-forecast deterioration in demand at home and abroad, underlining
recent official concerns that growth is slowing.
The ECB is expected to indicate a readiness to cut interest rates as soon as
next month but hold back from policy moves, after a Group of Seven emergency
conference call on Tuesday failed to produce any concrete solution.
Fears that the problems in Europe are hurting the global economy have also
increased speculation that other major central banks could join in another
global round of policy easing.
Investors are also focussing on testimony by Federal Reserve Chairman Ben
Bernanke before a congressional committee on Thursday, which could signal
possible policy moves.
The euro rose and the dollar fell against a basket of currencies, making
commodities denominated in the greenback cheaper.
ALUMINIUM
The dismal economic outlook and low aluminium prices prompted Norsk Hydro
to shut its Kurri Kurri smelter in Australia, removing around 170,000
tonnes per annum from the market over the next two years, supporting the price
of the metal.
"Together with the potential for an alumina supply squeeze in China after
refiners there said they would cut output by 1.7 million tonnes in response to
tightening bauxite supply, we may see further pressure on Chinese smelters to
cut back in the medium term," ANZ said in a research note.
Three-month aluminium was up 0.8 percent at $7,410.25 from $1,972.50
at the close on Friday.
Zinc rose to $1,892, from $1,871, while lead was $1,925,
from $1,900, tin was $19,565 from $19,395, and nickel was $16,244 from
$16,100.
Metal Prices at 1038 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2011 Ytd Pct
move
COMEX Cu 335.50 6.60 +2.01 344.75 -2.68
LME Alum 1988.00 15.50 +0.79 2020.00 -1.58
LME Cu 7418.25 57.25 +0.78 7600.00 -2.39
LME Lead 1923.25 23.25 +1.22 2034.00 -5.44
LME Nickel 16242.00 142.00 +0.88 18650.00 -12.91
LME Tin 19555.00 160.00 +0.82 19200.00 1.85
LME Zinc 1893.25 22.25 +1.19 1845.00 2.62
SHFE Alu 15905.00 -20.00 -0.13 15845.00 0.38
SHFE Cu* 54080.00 290.00 +0.54 55360.00 -2.31
SHFE Zin 14785.00 110.00 +0.75 14795.00 -0.07
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
