LONDON: Copper hit a three-month high on Wednesday as the dollar dropped, concerns lingered over possible supply disruptions in Chile and as investors saw solid global economic growth boosting demand for the metal.
Nickel and zinc hit their highest in more than a month, meanwhile, tracking the ferrous complex higher after a blast at an iron ore mine in China and amid falling inventories.
Copper has risen nearly 4 percent this week after the union at BHP's Escondida mine in Chile, the world's largest, said on Friday it had started the latest round of wage negotiations.
Failure to reach a deal last year led to a strike that resulted in a near 8 percent drop in annual output.
"It's natural that anything related to Escondida is going to cause a bit of a flare up. The concentrates market is very tight. That's magnifying any (possible) supply shocks," said Kash Kamal, analyst at BMO Capital Market.
Also boosting metals were signs of solid global growth, with trepidation over trade wars and fractious European politics taking a backseat after data this week showed ongoing expansion in global business activity.
The dollar hit a 10-day low versus the euro, which was lifted by hawkish comments from the European Central Bank. A weaker dollar makes dollar-priced metals cheaper for non-US investors.
* LME COPPER: Three-month copper on the London Metal Exchange hit $7,163 a tonne, its highest since Feb. 26, and stood at $7,153.50 a tonne at 1023 GMT, up 0.7 percent on the day.
Signs of slowing downstream demand in China, the world's top copper consumer, and the strength of the dollar mean copper "may continue to be range-bound with periodic upside surprise on the newsflow of supply disruptions," Argonaut Securities said in a note.
* ALUMINIUM: LME aluminium rose 0.8 percent to $2,329.50, having hit $2,345 a tonne, the highest since May 10.
* ALUMINIUM PREMIUMS: Spot aluminium premiums in Asia have nearly halved in recent weeks, even as US premiums hold at three-year highs, driven down by an influx of Chinese metal and bets that Russian producer Rusal will avoid sanctions.
* FERROUS: Chinese iron ore futures climbed to their highest level in two weeks after an iron ore mining accident, stirring concerns about potential tight supply in the market. Steel rebar futures also gained.
* ZINC/NICKEL: Steelmaking ingredient zinc hit its highest since late April at $3,220, while stainless steelmaking ingredient nickel hit its highest since mid April at $15,845.
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