METALS-Copper sets record high ahead of Fed rate decision

SHANGHAI, Dec 8 (Reuters) - Copper opened the week strong, setting a record high on Monday, bolstered by expectations of an interest rate cut by the U.S. Federal Reserve and prospect of supply tightness.

The most-active copper contract on the Shanghai Futures Exchange SCFcv1 closed daytime trading 1.54% higher to 92,970 yuan ($13,152.91) per metric ton.

The Shanghai copper registered an all-time high at 93,300 yuan earlier this session.

The benchmark three-month copper on the London Metal Exchange CMCU3 also gained, up 0.79% to $11,712 a ton as of 0700 GMT, after setting a peak at $11,771 earlier.

Markets are pricing in a quarter-point U.S. interest rate cut on Wednesday. A Reuters poll of 108 analysts found only 19 voted for no change.

Signs of lower supply helped buoy copper prices in Asia. Deliverable copper in SHFE sheds declined 9.22% by the end of last week, the exchange's weekly stock report showed on Friday - the second consecutive week of declines.

Cancellations were also seen in available, or on warrant copper stocks in LME warehouses last week. MCUSTX-TOTAL

Meanwhile, copper inventories in the U.S. Comex exchange HG-STX-COMEX continued to increase after hitting a record high in late November, totalling 436,853 short tons (396,306 metric tons) as of Friday.

Copper's strength is rooted in a structural mismatch between supply and available stocks as a persistent Comex–LME premium has diverted the metal towards the U.S., tightening supply in the rest of the world, analysts at Chinese broker GF said in a note.

Supply concerns are also fuelled by mine disruptions and China's major smelters agreeing to slash output by 10%.

Analysts at Citi said in a report on Friday that they expect copper to climb into next year and average about $13,000 a ton by the second quarter of next year, up from $12,000 in their previous outlook.

Most base metals saw their prices gain on Monday.

Among other SHFE base metals, aluminium SAFcv1 nudged 0.27% higher, zinc SZNcv1 gained 0.98%, lead SPBcv1 added 0.23%, and tin SSNcv1 gained 0.36%.

Among LME metals, aluminium CMAL3 rose 0.57%, zinc CMZN3 gained 0.82%, lead CMPB3 added 0.45%, tin CMSN3 increased 0.72%, and nickel posted sole loss, nudging 0.17% lower.

($1 = 7.0684 Chinese yuan renminbi)