Copper set for weekly gain on Fed rate cut bets, lower supply

By Lucas Liew

Sept 12 (Reuters) - Copper futures were headed for a weekly rise on Friday, buoyed by anticipation of U.S. Federal Reserve rate cuts and tightening supply following a dip in Peruvian output.

Three-month copper on the London Metal Exchange CMCU3 rose 0.21% to $10,073 per metric ton by 0213 GMT, and is poised to end the week 1.77% higher.

The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 gained 0.7% to 80,640 yuan ($11,326.16) a ton, and is set to end the week up 0.89%.

The dollar index =USD, which measures the U.S. currency against six major peers, last traded at 97.585 and on track to record its second consecutive weekly decline. The greenback was under pressure after higher U.S. jobless claims and a modest increase in inflation reinforced expectations for Fed rate cuts next week. USD/

A softer dollar makes greenback-denominated assets more affordable to holders of other currencies. FRX/

Copper output in Peru, the world's third-largest copper producer, fell 2% year-on-year in July to 228,007 metric tons.

However, output for the first seven months of the year rose 3.3% compared to the same period last year, and the government expects annual production to slightly increase to 2.8 million tons in 2025.

Elsewhere, mining giant Eurasian Resources Group announced that it had signed a settlement with the Democratic Republic of Congo's state-owned miner Gecamines following a project dispute.

The dispute had resulted in the suspension of development at several copper and cobalt deposits in Congo, one of the world's leading copper producers.

Meanwhile, LME-registered copper stocks MCUSTX-TOTAL stood at 154,175 tons, down 1.06% for the week ended September 8.

Among other London metals, aluminium CMAL3 rose 0.28%, nickel CMNI3 climbed 1.32%, tin CMSN3 increased 0.51%, and zinc CMZN3 gained 0.41%, while lead CMPB3 lost 0.18%.

SHFE aluminium SAFcv1 rose 0.94%, nickel SNIcv1 strengthened 1.37%, lead SPBcv1 climbed 0.21%, tin SSNcv1 gained 0.97%, and zinc SZNcv1 increased 0.34%.