METALS-Copper prices retreat from one-month high on dollar strength

Updates prices

By Violet Li

SHANGHAI, Jan 15 (Reuters) - Most base metals declined on Wednesday, with copper pulling back from a one-month high, weighed down by a strong U.S. dollar.

Three-month copper CMCU3 on the London Metal Exchange (LME) slid 0.3% to $9,123 per metric ton by 0722 GMT.

The dollar's rally slowed due to caution ahead of the highly anticipated U.S. consumer inflation report, due later in the day, prompting hesitation in taking on new positions.

The dollar index =USD, which measures the U.S. currency versus six other units, stood at 109.26 - not far from the 26-month high of 110.17 touched on Monday.

A stronger dollar makes greenback-priced commodities more expensive for holders of other currencies.

U.S. producer prices rose less than expected in December as higher costs for goods were partially offset by stable services prices, suggesting inflation remained on a downward trend but did not change the view that the Federal Reserve would not cut rates before the second half of the year.

The potential impact of U.S. President-elect Donald Trump's planned tariffs and the Fed's cautious stance on rate cuts have driven up Treasury yields and strengthened the dollar.

"The U.S. dollar is pretty strong these days, exerting pressure on metals prices. Meanwhile, investors adopt a wait-and-watch attitude before Trump's inauguration," a trader said.

The most active copper contract on the SHFE SCFcv1 was down 0.2% at 75,140 yuan ($10,250.15) a ton by the close of the Asia afternoon trade session.

LME aluminium CMAl3 was up 0.5% to $2,573 a ton, tin CMSN3 fell 1.1% to $29,445, nickel CMNI3 slipped 0.7% to $15,840, lead CMPB3 slid 0.8% to $1,951 and zinc CMZN3 lost 1.1% to $2,832.

SHFE aluminium SAFcv1 slid 0.5% to 20,185 yuan a ton, nickel SNIcv1 was down 0.2% to 127,560 yuan, zinc SZNcv1 fell 2.4% to 23,595 yuan, lead SPBcv1 gained 0.3% to 16,535 yuan and tin SSNcv1 shed 1.7% to 244，290 yuan.

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($1 = 7.3316 Chinese yuan renminbi)

(Reporting by Violet Li and Mei Mei Chu; Editing by Sherry Jacob-Phillips, Savio D'Souza and Rashmi Aich)

((Violet.Li@thomsonreuters.com;))

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