METALS-Copper retreats from multi-month high on profit-taking

By Amy Lv and Lewis Jackson

BEIJING, Sept 16 (Reuters) - Copper prices retreated on Tuesday from their multi-month highs, as profit-taking by some traders outweighed support from cemented bets of a U.S. rate cut and progress in trade talks between the United States and top consumer China.

The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 surrendered some earlier gains to end daytime trading up 0.06% at 80,880 yuan ($11,366.89) per metric ton. Earlier in the session, the contract hit its highest since March 28 at 81,530 yuan.

Benchmark three-month copper CMCU3 on the London Metal Exchange slid 0.61% to $10,124.5 a ton by 0839 GMT. The contract touched a 15-month peak at $10,192.5 on Monday.

"It's driven by the move of traders to cash in profits before the final decision of a Fed rate cut," said a Beijing-based trader on condition of anonymity as he is not authorised to speak to the media.

The rapid price rise has met resistance from downstream consumers, which in turn has limited upside, according to two other traders.

Downstream buying slowed after prices climbed over 80,000 yuan, said a Chinese copper smelter, requesting anonymity.

U.S. and Chinese officials reached a framework agreement on Monday regarding short-video app TikTok, igniting hopes that a trade deal will be close, which lifted sentiment and limited price losses.

Also, heightened bets for a rate cut by the U.S. Federal Reserve on Wednesday supported prices, analysts at broker Everbright Future said in a note.

Rate cuts boost copper prices through the mechanism of a weaker dollar, combined with expectations of stronger demand, analysts at Benchmark Minerals Intelligence said in a note.

Among other SHFE metals, nickel SNIcv1 added 0.36%, aluminium SAFcv1 shed 0.33%, tin SSNcv1 dipped 0.42%, zinc SZNcv1 lost 0.22% and lead SPBcv1 slipped 0.38%.

Among other LME metals, aluminium CMAL3 was little changed, nickel CMNI3 declined 0.2%, lead CMPB3 retreated 0.12%, zinc CMZN3 fell 0.37% while tin CMSN3 added 0.23%.

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($1 = 7.1154 Chinese yuan)