METALS-Copper hits 3-week high as US-Iran ceasefire eases global slowdown fears

April 8 (Reuters) - Copper prices hit a three-week high on Wednesday after U.S. President Donald Trump agreed to a two-week ceasefire with Iran, sending oil prices sharply lower and easing fears of a global economic slowdown.

Benchmark three-month copper CMCU3 on the London Metal Exchange jumped 3% to $12,680.50 a metric ton as of 0736 GMT, hitting its highest level since March 18.

The most-active copper contract SCFcv1 on the Shanghai Futures Exchange gained 1.6% to 98,220 yuan ($14,323.22) a ton, also its strongest level since March 18.

"The strength in base metals would come from much lower crude oil prices, which will postpone the possibility of a global slowdown or recession," said Marex analyst Edward Meir.

Crude oil prices fell more than 13% as the ceasefire raised hopes for the possible resumption of oil and gas flowing through the Strait of Hormuz. O/R

The sharp drop in oil prices improved the outlook for metals, including copper, easing concerns of an energy shock that would squeeze global growth and manufacturing.

The U.S. dollar sank to its lowest level in a month, making greenback-denominated commodities more affordable for holders of other currencies. USD/

Trump's announcement came shortly before his deadline for Iran to open the strait, where 20% of the world's oil transits, or face widespread attacks on its civilian infrastructure.

Tehran said talks with the United States would begin on Friday in Islamabad after it submitted a 10-point proposal to Washington via Pakistan.

Elsewhere, London aluminium CMAL3 rose 0.1% to $3,479 a ton, while the most-traded Shanghai contract SAFcv1 gained 0.5% to 24,760 yuan a ton.

Among other LME metals, tin CMSN3 climbed 4.7%, zinc CMZN3 gained 0.5%, lead CMPB3 was up 0.7%, and nickel CMNI3 rose 2%.

On SHFE, zinc SZNcv1 gained 0.8%, lead SPBcv1 rose 0.5%, tin SSNcv1 was up 4.1%, and nickel SNIcv1 rose 0.3%.