LONDON: Copper hit a two-month high on Wednesday as the dollar fell and investors remained upbeat about global growth prospects as a US tax overhaul neared completion and China's economy remained on a firm footing.
The dollar slid against most currencies, with the greenback seen as having limited upside given that investors have already factored in a comprehensive US tax bill that is all but certain to be signed into law by President Donald Trump.
A weak dollar makes dollar-priced metals cheaper for non-US investors.
"Overall it seems investor confidence has come back. When we crossed $6,700 again last week it triggered buying. The weaker dollar is helping," said a trader.
COPPER PRICE: Three-month copper on the London Metal Exchange ended up 1.5 percent at $7,0454 a tonne, crossing the psychologically important $7,000 mark and hitting its highest since mid-October at $7,070.50
CHINA ECONOMY: In China, consumer of nearly half the world's copper, leaders at an economic planning meeting said Beijing will deepen structural reforms and curb risks to the financial system while maintaining steady growth in 2018.
* "US equities are at record highs, tax cuts are coming through, global growth is not too hot but not too cold either, there's lots of reasons to be risk on. Strikes are going to be a big factor next year (in copper)," said Robin Bhar, metals specialist at Societe Generale.
COLUMN: Threat of strikes looms large for copper supply in 2018: Andy Home
PERU: The centre-right government of Peru's embattled President Pedro Pablo Kuczynski cancelled its scheduled auction of a $2 billion copper project, Michiquillay, amid a growing political crisis.
LEAD: Seasonally strong demand drove and low stocks drove lead prices to a two-month high of $2,572 a tonne, but the metal closed down 1.1 percent at $2,525 as supply tightness linked to technical factors eased.
TECHNICALS: The premium for cash lead over the three-month price fell to $4.20 a tonne from $24 on Monday, when fears of supply shortages on the LME prevailed given one entity held between 50-80 percent of lead warrants or ownership tiles.
ALUMINIUM: Aluminium closed up 1.1 percent at $2,122, its highest since late November, as rising raw material prices and production cuts in China provided end-of-year support to the market.
OTHER METALS: Zinc ended up 0.5 percent at $3,218 a tonne, tin ended up 0.6 percent at $19,475 while nickel closed up 2.3 percent at $12,030 a tonne, having hit its highest since mid-November.
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