METALS-Copper firms on US rate cut bets, supply worries

BEIJING, Sept 15 (Reuters) - Copper prices firmed on Monday, supported by expectations of a U.S. Federal Reserve interest rate cut this week and lingering supply worries, while caution over resumed trade talks between the United States and China curbed gains.

The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 closed daytime trade 0.36% higher at 81,000 yuan ($11,371.77) per metric ton.

Benchmark three-month copper CMCU3 on the London Metal Exchange was up 0.07% at 10,075 ton after hitting its intra-day high at $10,101 earlier in the session, close to an over-five-month high at $10,126 touched on Friday.

The Fed is widely expected to cut rates by 25 basis points at its meeting this week, following consecutive weak labor market reports.

"The prospect of easing monetary policy improves the outlook and boosts sentiment," ANZ analysts said in a note.

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

Prices were also buoyed by lingering worry over supply, as efforts to rescue seven workers at Freeport Indonesia's Grasberg mine were continuing one week after a heavy mud flow trapped them underground.

Focus was also on U.S.-China negotiations in Madrid to resolve trade tension between the two major economies. U.S. Treasury Secretary Scott Bessent said the countries were close to reaching an agreement on the short-video app TikTok.

That came after Washington called on its allies to place tariffs on imports from China over its purchases of Russian oil, while Beijing initiated an anti-discrimination investigation into U.S. trade policy over chips on Saturday, which cast a shadow on prospects of the talks.

SHFE nickel SNIcv1 added 1.01%, lead SPBcv1 advanced 1.72%, tin SSNcv1 rose 0.41% while aluminium SAFcv1 dipped 0.55%, zinc SZNcv1 edged down 0.02%.

LME aluminium CMAL3 fell 0.26%, nickel CMNI3 added 0.55%, lead CMPB3 slid 0.32%, tin CMSN3 and zinc CMZN3 were little changed.

Also, a batch of weak data, including outstanding total social financing (TSF) and falling home prices, from top consumer China weighed on sentiment, limiting gains in prices.

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($1 = 7.1229 Chinese yuan)