LONDON: Copper prices slipped on Friday as the dollar rose and as investment and industrial production data from top consumer China fuelled worries about demand for the metal used widely in power and construction.
Traders said the market was waiting to hear Donald Trump's plans for the US economy after his inauguration as President later on Friday.
Benchmark copper on the London Metal Exchange was down 0.3 percent at $5,721 a tonne at 1055 GMT. It is on course for its first weekly loss since before the Christmas break.
Expections of higher US interest rates this year have boosted the US currency, which when it rises makes dollar-denominated commodities more expensive for non-US firms, potentially undermining their demand.
"The dollar will be key for metals, which have been remarkably resilient, partially driven by expectations for the rebuilding of America by Donald Trump," said SP Angel analyst John Meyer. "But at some stage reality must set in. US infrastructure spending is not widely expected to be a game-changer for industrial metals demand.
China, which accounts for around half of global demand for industrial metals, will remain the main focus this year. Its Lunar New Year holiday starting Jan. 27 is expected to subdue demand and manufacturing activity this month and next as factories close, sometimes for two to three weeks.
Analysts say above consensus Chinese economic growth of 6.8 percent year-on-year in the final quarter of last year will support sentiment, but that investment and industrial production data for December suggest slow demand growth.
"Growth in fixed-asset investment, which is a major source of metals demand and includes sectors such as infrastructure, manufacturing and property, slowed," Julius Baer said in a note.
Most notably, growth in infrastructure investment dropped to just over 5 percent after peaking at more than 20 percent last summer...Weakness in property is looming, however, as regulation was tightened last year and oversupply in many lower-tier cities persists."
Three-month aluminium rose 0.3 percent to $1,832 on talk that China might have to cut smelting capacity because of environmental concerns.
Zinc fell 0.9 percent to $2,743, lead ceded 0.5 percent to $2,274, nickel lost 1.2 percent to $9,775. Tin slid 1.5 percent to $20,455 from an earlier $20,250 its lowest since Nov. 30.
Traders said tin was coming under pressure from expectations of higher supplies and rising stocks in LME approved warehouses.
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