* Copper rises to highest since Sept. 8 at $6,850/T
* LME/ShFE arb: http://bit.ly/2wZSAEz
* GRAPHIC-2017 metal returns: http://tmsnrt.rs/2eqHKkL (Updates throughout, adds LONDON dateline)
LONDON, Oct 12 (Reuters) - Copper hit its highest in more than a month on Thursday as a retreat in the dollar pushed most metals prices higher, and on optimism over the demand outlook from major consumer China.
The U.S. currency slipped to a two-week low against the euro as robust economic data from the euro zone came after minutes from the Federal Reserve's latest meeting which indicated persistent concerns about low inflation.
"There is a lot of momentum investor interest (in copper)," Capital Economics analyst Caroline Bain said. "And (there is) some optimism about demand... chiefly in China."
Many metals market participants are awaiting the outcome of China's Communist Party Congress next week, she said, for an indication of broader policy initiatives and their implications for metals demand.
* LME COPPER: London Metal Exchange copper was up 0.6 percent at $6,841.50 a tonne by 0935 GMT. Prices earlier hit their highest since Sept. 8 at $6,850 a tonne, and were edging towards a three-year peak of $6,970 marked on Sept. 5.
* COPPER STOCKS: Stocks of copper in London Metal Exchange warehouses <MCU-STOCKS> fell by another 1,025 tonnes, exchange data showed on Thursday. They are now down 9 percent from mid-September's two-month peak.
* CHINA DEMAND: Solid demand in China has opened the 'arbitrage window' for copper imports, traders said. Premiums for copper held in China bonded zones have climbed by $9 this week to $74, the highest in more than two months. <CU-BMPBW-SHMET>
* U.S. INTEREST RATES: Fed policymakers had a prolonged debate about the prospects of a pickup in inflation and slowing the path of future interest rate rises if it did not, according to the minutes of the U.S. central bank's last policy meeting.
* NICKEL: LME nickel was 1.2 percent higher at $11,270 a tonne, having earlier touched a three-week peak of $11,305.
* LME LEAD: Lead was down 0.1 percent at $2,562.50 a tonne, held in check by prospects of rising supply after a China smelter said it had restarted production.
* MMG: MMG Ltd, the international mining unit of state-owned China Minmetals Corp, has become China's preferred developer of overseas projects and is looking at acquisitions beyond its core strengths of copper and zinc, MMG's chief executive said.
* OTHER METALS: LME zinc was up 0.5 percent at $3,236 a tonne, while aluminium was 0.6 percent higher at $2,143.50 a tonne. Tin was down 0.3 percent at $20,810 a tonne.
(Additional reporting by Melanie Burton in Melbourne; Editing by Adrian Croft)