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London copper increases to six-week high on US rate-cut optimism

Copper rates in London rose almost 1% on Tuesday to their greatest levels in nearly six weeks, supported by optimism over a possible U.S. rates of interest cut in September that could assist lift demand for the red metal.

Three-month copper on the London Metal Exchange (LME). was up 0.8% at $9,365 per metric lot, since 0251 GMT. Earlier in the session, copper increased as much as 1% to. $ 9,385.50 a load, the greatest because July 19.

The most-traded October copper agreement on the Shanghai. Futures Exchange (SHFE) climbed up 0.9% to 75,020 yuan. ($ 10,526.91) a lot, hovering near a three-week high hit in the. previous session.

The increase in copper of late can be attributed to the macro. environment. Demand is still lagging behind, however the onshore. macro players are looking further beyond, a trader said.

Market participants have been expecting a rate of interest cut. by the Federal Reserve next month, and the hope was strengthened. by Fed Chair Jerome Powell's remarks at a crucial conference last. week.

A rate cut tends to enhance financial development and need for. metals, in addition to pressure the dollar, which will eventually. makes greenback-priced metals less expensive for holders of other. currencies.

A great deal of the news are priced in already, so the next big. dive will need to come from an enhancement in fundamental. need. Otherwise it's not sustainable, the trader said.

LME nickel increased 1.3% to $16,980 a heap, aluminium. fell 1.1% to $2,513.50, zinc alleviated 0.2% to. $ 2,907.50, tin dropped 0.8% to $32,650 while lead. was nearly flat at $2,117.50.

SHFE nickel increased 1.4% to 132,320 yuan a load,. lead advanced 0.4% to 17,695 yuan, while aluminium. fell 0.2% to 19,880 yuan, zinc eased 0.3% to. 23,975 yuan and tin shed 0.7% to 265,820 yuan.

The LME money nickel contract was trading at a discount rate of. $ 220.10 a ton to the three-month agreement, the tiniest discount rate. because May 16, suggesting tightening nearby products. << CMNI0-3 >

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(source: Reuters)