Copper hit a seven-month high on Friday and was set for a fifth straight weekly gain after a US-China trade deal dispelled some worries over the health of the global economy, though it retreated from the day's peak as the dollar firmed.
Benchmark copper on the London Metal Exchange (LME) ended down 0.6% at $6,175 a tonne after reaching $6,235.50, the highest since May 7. It was up nearly 1% this week and more than 5% this month.
"Copper had a good run and is holding its own," said Commerzbank analyst Daniel Briesemann, adding that optimism after Washington and Beijing agreed a "phase one" trade deal had lifted base metals and would support prices for some time.
But he said a "phase two" deal would be harder to achieve and global economic growth would weaken further next year, dragging copper to around $5,500 by mid-2020.
US Treasury Secretary Steven Mnuchin said the United States and China would sign their phase one pact in early January.
The US House of Representatives overwhelmingly approved a new North American deal that leaves $1.2 trillion in annual US-Mexico-Canada trade flows largely intact.
On-warrant copper inventories in LME-registered warehouses fell to 110,350 tonnes, the lowest since March, after 8,325 tonnes of cancellations.
The global refined copper market had a 81,000-tonne deficit in September and 393,000-tonne shortfall for the first 9 months of the year, the International Copper Study Group (ICSG) said.
The ICSG said in October the copper market would move to surplus next year.
"Copper open interest (OI) has increased notably across each of the three main exchanges (LME/Comex/SHFE) and is in aggregate up by around 1.3 million tonnes over the past month - a pace not seen since the 2016 US presidential election," Citi analysts said in a note.
This pointed to an increase in speculative bets on higher prices, they said, adding that prices were likely to rise to around $6,500 by mid-2020.
Fitch Solutions said in a note copper would average $5,700 a tonne in 2020, down from $6,000 this year, as global economic weakness persisted.
Chinese Yangshan copper import premiums fell to $59 from $85 in September, suggesting weakening demand for overseas metal.
LME aluminium closed up 0.2% at $1,800 a tonne, zinc rose 0.7% to $2,341, nickel gained 2.5% to $14,525 and tin finished 0.2% lower at $17,340. Lead did not trade in closing rings but was bid up 1% at $1,938. All were up this week.
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