(Updates prices) By Pratima Desai LONDON, Feb 27 (Reuters) - Copper rose on Monday as thedollar weakened, but prices remained close to seven-week lowsdue to a lack of evidence of a healthier demand outlook in topconsumer China ahead of key data on the country's manufacturingsector. While the dollar fell, it was still hovering near seven-weekhighs against other major currencies on expectations that U.S.interest rates could peak at a higher level than previouslyforecast. A stronger U.S. currency makes dollar-priced industrialmetals more expensive for holders of other currencies,potentially subduing demand. Benchmark copper on the London Metal Exchange (LME)had gained 1.2% to $8,816.50 a tonne by 1745 GMT after earliertouching its lowest since Jan. 9 at $8,670. Surveys of purchasing managers in China's manufacturingsector, due this week, are expected to show growth. PurchasingManagers' indices (PMI) are a strong lead indicator for metalsconsumption and prices. "There doesn't seem to have been any uptick in Chineseconsumption," said Sucden Financial analyst Geordie Wilkes.
"We need to see where the strength is coming in the PMIs ...the new orders index is an indicator of fresh demand," he said. A sign of weak demand overall is the discount for cashcopper against the three-month contract .
Copper stocks in warehouses monitored by theShanghai Futures Exchange have risen 360% to 252,455 tonnessince Dec. 23, suggesting weak Chinese demand. "Many assets rallied as China's government accelerated thereopening of the economy. Copper ... has had the strongest startto a year since 2003," said Bank of America analyst MichaelWidmer. "Yet this rally has been accompanied by weaker physicalmarkets in China." In other metals, aluminium was up 1.5% at $2,370.50a tonne, zinc rose 1% to $2,994, lead gained1.7% to $2,106.50, tin was down 0.5% at $25,530 andnickel climbed 3.7% to $25,450.
(Reporting by Pratima DesaiAdditional reporting by Peter HobsonEditing by David Goodman and Josie Kao)
LME price overview COMEX copper futures All metals news All commodities news Foreign exchange rates SPEED GUIDES )) Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.