LONDON: Copper edged higher on Monday as news that a US-China trade war had been put "on hold" overshadowed a rising dollar, while nickel came under pressure from falling ferrous metals prices in China.
The dollar hit a five-month high versus a currency basket, making dollar-priced metals costlier for non-US investors and capping the upside in metals. Gold hit a 2018 low.
"Copper hasn't fallen significantly whereas the dollar has had a nice recovery in recent months. (It tells you) people are convinced demand will outweigh supply growth," said Fawad Razaqzada, analyst at FOREX.com.
The "risk on" sentiment was not enough to support stainless steelmaking ingredient nickel, which came under pressure after Chinese iron ore prices plunged more than 3 percent on uncertain prospects for steel demand.
US Treasury Secretary Steven Mnuchin declared the US trade war with China "on hold" following an agreement to drop tariff threats that had roiled global markets this year.
COPPER: Three-month copper on the London Metal Exchange rose 0.8 percent to $6,911.50 a tonne by 1024 GMT, breaking out of the tight range of $6,765-$6,900 in which it had traded over the past week.
NICKEL: Nickel traded down 0.5 percent at $14,675 a tonne, after Dalian iron ore touched its lowest since May 7 amid reports steel mills may postpone raw material purchases due to uncertainty over demand.
"Given iron ore's 3.5 percent decline, nickel has held up remarkably well. Late Friday saw Vale's CEO report they are taking out 150,000 tonnes of production for the next three years," Marex Spectron said in a note.
CHINA STEEL CAPACITY: China will shut more outdated steel plants and bring capacity to less than 1 billion tonnes by 2025, the country's steel industry association said, adding Chinese demand for the metal is set to decline gradually.
RUSAL: UC Rusal has not yet received any formal notice that sanctions target Oleg Deripaska has resigned from his board position at major Rusal shareholder EN+, the aluminium maker said on Monday.
CHINA ECONOMY: China's economy will likely expand by around 6.7 percent in the second quarter this year, the State Information Center said in an article in the state-owned China Securities Journal on Saturday.
JAPAN ECONOMY: Japan's exports accelerated in April on increased shipments of cars and machines used to make semiconductors, suggesting healthy overseas demand could help the economy recover quickly from a dip in the first quarter.
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