* GRAPHIC-2017 asset returns: http://tmsnrt.rs/2jvdmXl
* LME/ShFE arb: http://bit.ly/2wZSAEz (Updates throughout, changes MELBOURNE dateline)
LONDON, Jan 25 (Reuters) - Zinc, nickel and lead rallied to multi-year highs on Thursday on a softer dollar and steadily declining inventories in London Metal Exchange-approved warehouses.
The dollar skidded against other major currencies on Thursday after the U.S. treasury secretary said he welcomed a weaker greenback. A weaker dollar makes commodities more affordable for buyers paying with other currencies.
Capital Economics senior commodities economist Caroline Bain said that a stronger dollar had supported commodities across the board but warned that rising U.S. interest rate expectations tempered the outlook.
"Commodity prices could have further to go because there is a lot of momentum and optimism, as we can see in the futures market," Bain said.
"But over the course of this year we will see this optimism fading and we think the global economy and China will slow down, leading to lower prices."
INVENTORIES: On-warrant LME inventories of lead <MPBSTX-TOTAL> -- those not earmarked for delivery -- fell by 1,200 tonnes to 78,000 tonnes and have shed 31 percent since mid-September.
LEAD PRICE: Lead eased by 0.4 percent to $2,623.50 a tonne after touching its highest since August 2011 at $2,653.
LEAD TRADE: Capping gains was Chinese data showing December lead imports down 18 percent.
ZINC PRICE: Zinc hit a decade high of $3,481.50 a tonne as headline stocks reached a more than nine-year low of 179,450 tonnes.
NICKEL: Customs data showed China's refined nickel imports grew by 116 percent year on year last month. LME nickel touched its highest since May 2015, later trading 0.2 percent up at $13,605 a tonne. Nickel, mainly used in stainless steel, had jumped by 5.6 percent in the previous session.
LME COPPER: London Metal Exchange copper was flat at $7,153 a tonne. Prices have rebounded from one-month lows towards the highest in a week but are still below the late-December peak of $7,312 and expected to be pressured by rising exchange inventories.
COPPER INVENTORIES: On-warrant copper stocks in LME-approved warehouses jumped by 24,825 tonnes to 253,400 tonnes and are up 67 percent over the past week. Headline levels have climbed by 46 percent to 2996,600 tonnes.
CHINA: China's December refined copper imports fell 8.8 percent year on year to 328,338 tonnes, according to customs data on Thursday. The figure was also down fractionally from November.
Capital Economics' Bain said the market had been overestimating copper demand and that it was no surprise to see stocks reappearing.
CHINA CURBS: China will ease restrictions for foreign companies in its manufacturing and services sectors as it rolls out fresh market-opening measures that could exceed international expectations, a senior Communist Party member said in Davos on Wednesday.
(Additional reporting by Melanie Burton and Tom Daly; Editing by David Goodman)