METALS-Copper edges higher on US rate cut hopes and Chinese demand

By Eric Onstad

LONDON, Aug 8 (Reuters) - Copper prices crept higher for a third consecutive session on Friday, bolstered by hopes of U.S. interest rate cuts after a central bank appointment and upbeat economic data in China.

Benchmark three-month LME copper CMCU3 on the London Metal Exchange had gained 0.8% to $9,759 a metric ton by 1602 GMT, extending a rebound after touching its lowest in three weeks on July 31.

U.S. President Donald Trump on Thursday announced his pick to fill a vacant seat at the Federal Reserve, boosting hopes of interest rate cuts and weakening the dollar. FRX/

A softer dollar .DXY makes commodities priced in the U.S. currency less expensive for buyers using other currencies.

"The weaker dollar has been a key driver in August," said Dan Smith at Commodity Market Analytics.

"You've got dollar weakness and China looking like it's in good shape. So the fundamental side feels like it's quite positive for the time being."

Data released on Thursday showed China's exports beat forecasts in July as manufacturers made the most of a fragile tariff truce between Beijing and Washington to ship goods.

The most traded copper contract on the Shanghai Futures Exchange SCFcv1 rose 0.1% to 78,490 yuan ($10,929) a ton.

Smith said LME copper was looking potentially bullish in his algorithmic computer models, which seek to replicate fund activity that places buy and sell orders largely on momentum signals.

"There's a chance that next week it will flip back into giving a buy-signal on copper, with an upside potentially up towards $10,000."

U.S. Comex copper futures HGc3 added 1.6% to $4.4925 a lb or $9,904 a ton, taking the premium of Comex over LME copper to $145 a ton.

On the supply side, investors were watching developments in top copper producer Chile, where Codelco has sought permission to reopen a part of its flagship mine after a fatal accident last week.

Other metals were mixed. LME aluminium CMAL3 was flat at $2,610 a ton and zinc CMZN3 rose 0.5% to $2,827, tin CMSN3 slipped 0.1% to $33,700, nickel CMNI3 climbed 0.3% to $15,160 and lead CMPB3 slipped 0.3% to $2,003.

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