METALS-Copper firm on weaker dollar, holiday quietens trade
* Focus on ECB president Draghi's comments after meeting
* Volumes thin ahead of week-long Lunar New Year holiday
* ECB leaves rates unchanged
LONDON, Feb 7 (Reuters) - Copper was steady on Thursday, supported by a weaker dollar but volumes were thin ahead of a week-long Lunar New Year holiday in top metals consumer China. An improved outlook for the global economy this year, reflected in positive data from China to the United States, helped lift copper prices earlier this week, although the optimism has yet to translate into strong physical demand. Three-month copper on the London Metal Exchange was $8,252 in official rings from a close of $8,245 on Wednesday. It hit a four-month high of $8,346 on Monday. Volumes were a slim 6,330 lots by 1310 GMT. "If you look at the prices over the last week or two, it's come alongside builds in inventories, and fundamentals haven't really started to improve yet," Barclays analyst Gayle Berry said. "That said, I think the market is definitely getting a bit more positive on global growth prospects for this year, and in particular I think people are hanging about waiting to see what happens after Chinese New Year, to see if there will be a bit of a pickup in physical activity " The week-long Lunar New Year holiday starts this weekend. "CTA (commodity trade advisory) activity has been dominating the market from both sides of the tape. The recent bullish breakouts in the complex were met with good buying from the CTA's which lasted up until early yesterday," RBC said in a research note. Investors also waited for China's trade numbers on Friday. Copper imports could recover slightly in January after falling in December, although near-record stocks in Shanghai will keep any increase modest. The ECB, as expected, held its main interest rate at a record low of 0.75 percent on Thursday, maintaining its policy in order to see whether an economic recovery sets in later this year or is derailed by the euro's rise.
Financial markets will focus on ECB President Mario Draghi's comments on the prospects for the euro zone economy. The euro held steady against the dollar after the ECB announcement, but the dollar turned lower against a basket of currencies. A weaker dollar makes metals less expensive for holders of other currencies. Three-month tin, untraded in rings, was bid at $24,950 per tonne from $24,850 at the close on Wednesday, while zinc was $2,160.5 in rings from $2,170. Three-month lead was $2,417 per tonne in rings from $2,422, and aluminium was $2,105.5 from $2,095. Nickel was $18,295 from $18,320. "The LME complex is starting to feel the effects of the upcoming Chinese New Year as prices have fallen on low volume. We expect the reduced volume to carry us into the weekend and remain a fact straight through till mid February," RBC said.
Metal Prices at 1310 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2012 Ytd Pct
COMEX Cu 374.75 0.70 +0.19 365.25 2.60 LME Alum 2105.00 -6.00 -0.28 2073.00 1.54 LME Cu 8245.00 0.00 +0.00 7931.00 3.96 LME Lead 2416.25 -5.75 -0.24 2330.00 3.70 LME Nickel 18288.00 -32.00 -0.17 17060.00 7.20 LME Tin 24950.00 100.00 +0.40 23400.00 6.62 LME Zinc 2161.25 -8.75 -0.40 2080.00 3.91 SHFE Alu 15090.00 -55.00 -0.36 15435.00 -2.24 SHFE Cu* 59460.00 -230.00 -0.39 57690.00 3.07 SHFE Zin 15745.00 -140.00 -0.88 15625.00 0.77 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07