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METALS-Copper prices steady as dollar weakens; China data in focus

MELBOURNE, May 23 (Reuters) - London copper held near its highest in three weeks on Tuesday as the dollar fell, with focus shifting to an upcoming monthly breakdown of China trade data.

FUNDAMENTALS

* London Metal Exchange copper was flat at $5,706 a tonne at 0135 GMT, after a slightly firmer close in the previous session when it touched the highest since May 3 at $5,720 a tonne.

* Shanghai Futures Exchange copper held gains of half a percent at 46,050 yuan ($6,687) a tonne.

* LME zinc and lead were also buoyed by a positive tone in steel, up 0.7 and 1 percent respectively, after China pledged to cut polluting factories.

* Nearby tightness in lead spreads dissolved, falling from a $34.50 premium for cash over the three-month contract in late April to a 23.25 discount overnight, which was the widest contango since July 2014 and which may flag a big delivery into LME exchange warehouses. <CMPB0-3>

* The euro hovered near a six-month high against the dollar on Tuesday after German Chancellor Angela Merkel said the currency was "too weak." A weaker dollar makes commodities, priced in dollars, more affordable for holders of other currencies.

* The Flash Markit/Nikkei Japan Manufacturing Purchasing Managers Index (PMI) fell to 52.0 in May on a seasonally adjusted basis, from a final 52.7 in the previous month.

* Asian countries disagreed over a China-backed free trade deal at talks on Monday, raising questions over a target for concluding negotiations by the end of the year.

* The global world refined copper market showed a 93,000 tonnes surplus in February, compared with a 55,000 tonnes surplus in January, the International Copper Study Group (ICSG) said in its latest monthly bulletin.

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MARKETS NEWS

* Sterling extended losses after British police said they were treating an explosion in Manchester as a possible terrorist attack, while the euro retained gains made on comments by German Chancellor Angela Merkel that the common currency was "too weak."

DATA/EVENTS 0600 Germany Detailed GDP Q1 0645 France Business climate May 0700 France Markit manufacturing PMI flash May 0730 Germany Markit manufacturing PMI flash May 0800 Germany Ifo business climate May 0800 Euro zone Markit manufacturing PMI flash May 1345 U.S. Markit manufacturing PMI flash May 1400 U.S. New home sales Apr PRICES

BASE METALS PRICES 0133 GMT Three month LME copper 5709 Most active ShFE copper 46060 Three month LME aluminum 1938 Most active ShFE aluminum 14010 Three month LME zinc 2652.5 Most active ShFE zinc 22380 Three month LME lead 2113 Most active ShFE lead 15745 Three month LME nickel 9430 Most active ShFE nickel 78390 Three month LME tin 20420 Most active ShFE tin 145810

BASE METALS ARBITRAGE

LME/SHFE COPPER LMESHFCUc3 115.28 LME/SHFE ALUMINIUM LMESHFALc3 -1537.97 LME/SHFE ZINC LMESHFZNc3 362.09 LME/SHFE LEAD LMESHFPBc3 -1646.33 LME/SHFE NICKEL LMESHFNIc3 1045.91

($1 = 6.8862 Chinese yuan renminbi)

(Reporting by Melanie Burton; Editing by Joseph Radford)