METALS-LME copper hits near 3-wk peak on global growth hopes
* Euro/dollar resistance at $1.3500 eyed for fresh spark in metals
* Coming up; U.S. Preliminary Q4 GDP at 1330 GMT
* Coming up; FOMC Policy decision at 1915 GMT
(Adds analyst, trader comment; updates prices) SINGAPORE, Jan 30 (Reuters) - London copper rose to nearly a three-week high on Wednesday, as hopes for improving global growth fanned risk appetite and weighed on the dollar, but traders were wary ahead of a Federal Reserve meeting and Chinese factory data. While the global economy is showing fresh signs of life, traders are looking out for confirmation from top consumer China's manufacturing sector this week before Lunar New Year holidays start next month. Copper has been trapped in a band of $7,920 to $8,250 a tonne since a new year rally fizzled out. "There are expectations for mildly dovish sentiment today that are weighing on the dollar and that's why we're seeing some gains across commodities," said commodities analyst Natalie Robertson of ANZ in Melbourne. "Copper is also trading a little more cautiously ahead of the Chinese new year. As a result we won't be expecting such a huge price rally on the back of China's factory figures, but it will certainly be supportive if they improve as expected." Three-month copper on the London Metal Exchange had climbed 0.62 percent to $8,153 a tonne by 0319 GMT, after earlier hitting $8,159 -- its highest since Jan. 11. LME copper closed up 0.66 percent on Tuesday. The most-traded May copper contract on the Shanghai Futures Exchange climbed about 1 percent to 59,280 yuan ($9,500) a tonne. It earlier marked its highest point since Sept. 28 at 59,400 yuan a tonne. U.S. home prices rose in November, climbing more than 5 percent from a year ago in the biggest increase since August 2006 when the housing market was starting to collapse, bolstering the outlook for the global economy. Market focus is now on the Fed's monetary policy committee, with the central bank expected to confirm it will keep up $85 billion in monthly bond buying until unemployment rates drop significantly, although officials have shown concern over side effects from such measures. "Rising housing prices in the U.S. and a late December spike in lumber prices certainly indicate the U.S. recovery is underway, but we still need confirmation from China that things are improving," said RBC Capital in a note. China's factory activity in January, scheduled for release on Friday, probably expanded at its fastest pace in nine months, adding to signs that recovery momentum is building as domestic demand strengthens. "We may well have to wait until after the Chinese Lunar New Year holidays to see the big move we have been expecting in metal prices," it added.
MARKETS NEWS A stronger euro was aiding the uplift in metals. Euro bulls were battling to break 14-month peaks versus the dollar and trip option barriers at $1.3500. A break beyond this level could spark a fresh really in metals, traders said. "Based on momentum, the euro looks certain to keep rising. Today is the FOMC so anything goes ... but the upside (on metals) looks very real," a Singapore-based trader said. A weaker dollar makes metals cheaper for holders of other currencies. "The USD could well correct further if today's US Q4 GDP release confirms the ongoing economic recovery while the Fed retains its dovish tone ... We are overall positive on EUR/USD and expect 1.38 in 3 months," said Credit Suisse in a note.
Base metals prices at 0319 GMT
Metal Last Change Pct Move YTD pct chg LME Cu 8153.00 50.00 +0.62 2.83 SHFE CU FUT MAY3 59280 590 +1.01 2.77 HG COPPER MAR3 370.60 1.45 +0.39 1.46 LME Alum 2070.00 10.00 +0.49 -0.05 SHFE AL FUT APR3 15220 65 +0.43 -0.81 LME Zinc 2116.75 21.75 +1.04 2.58 SHFE ZN FUT MAY3 15925 380 +2.44 2.44 LME Nickel 17840.00 -10.00 -0.06 3.99 LME Lead 2421.00 16.00 +0.67 3.46 SHFE PB FUT 15480.00 80.00 +0.52 1.51 LME Tin 24600.00 -50.00 -0.20 5.13 LME/Shanghai arb^ 275
Shanghai and COMEX contracts show most active months ($1 = 6.2243 Chinese yuan)
(Reporting by Melanie Burton; Editing by Himani Sarkar and Joseph Radford)