METALS-London copper edges higher on dollar weakness, China rate cut

NEW DELHI, May 21 (Reuters) - Copper prices in London were slightly higher on Wednesday, tracking some weakness in the U.S. dollar and stimulus efforts from top consumer China, although gains were limited due to persisting uncertainty over economic growth from high tariffs.

Benchmark copper CMCU3 on the London Metal Exchange (LME) was up 0.6% at $9,572.5 a metric ton as of 0208 GMT.

The U.S. dollar edged lower on Wednesday, extending a two-day slide against major peers, making greenback-priced commodities less expensive for buyers holding other currencies. USD/

On Tuesday, China cut benchmark lending rates for the first time since October, while major state banks lowered deposit rates as authorities work to ease monetary policy to help buffer the economy from the impact of the Sino-U.S. trade war.

Last week, U.S. and China agreed to reduce tit-for-tat tariffs and implement a 90-day pause on actions but there is uncertainty on what will follow after the temporary truce.

"Fears that these tariffs may contribute to a potential U.S. recession could cap gains in copper prices at higher levels," said Sugandha Sachdeva, founder, SS WealthStreet, a New Delhi-based research firm.

"Technically, copper has found strong support at $9,500 per tonne, and in the near term, prices are targeting the $9,950 per tonne mark, barring any significant negative macroeconomic surprises."

Among other London metals, aluminium CMAL3 was up 0.6% to $2,486.5 a ton, zinc CMZN3 firmed 0.4% to $2,721, lead CMPB3 gained 0.4% to $1,989 and nickel CMNI3 was up 0.08% to $15,530. Tin CMSN3 eased 0.04% to $33,070.

The most-traded copper contract on the Shanghai Futures Exchange (SHFE) rose 0.4% to 78,160 yuan ($10,837.8) per ton.

SHFE aluminium SAFcv1 was up 0.5% to 20,165 yuan a ton, zinc SZNcv1 gained 0.5% to 22,540 yuan, lead SPBcv1 was up 0.6% to 16,905 yuan, nickel SNIcv1 firmed 0.08% to 123,450 yuan, and tin SSNcv1 gained 1.2% to 267,960 yuan.

($1 = 7.2118 yuan )

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