LONDON: Copper prices succumbed to pressure from the dollar on Tuesday as the market anticipated a more hawkish tone from the U.S. Federal Reserve in the run-up to monetary tightening in March.

The Fed meets next week after fairly aggressive comments from officials about how tough they could be in the fight against inflation.

This led to a jump in U.S. Treasury yields that lifted the dollar index to its highest in six days and undermined the appeal of dollar-denominated commodities.

Risk sentiment was lower as a result, dragging stocks and some commodities lower, said Commerzbank analyst Daniel Briesemann.

“But for the most part, participants are waiting on the sidelines for a clearer statement that the Fed will start its interest rate hike cycle in March,” he said.

Benchmark three-month copper on the London Metal Exchange (LME) eased 0.7% to $9,662 a tonne by 1735 GMT. POSITIONING: Speculators bet on prices falling, evidenced by a net short position of 12.83% of open interest, estimates by broker Marex showed. This is its highest since May 2020.

INVENTORIES: Copper stocks continued to trend higher, with inventories in LME-registered warehouses climbing by 2,000 tonnes to their highest in two months at 94,525 tonnes.

COPPER EXPORTS: Refined copper exports from China hit a record high in 2021, customs data showed, after international prices encouraged traders to ship metals overseas.

TIN: Benchmark LME prices for the metal used in solder for electronics hit a record $42,335 a tonne, underpinned by low inventories and stable demand. Later it was up 1.5% at $42,315.

EUROPE: Industry association Eurometaux has asked EU policymakers to allow member states to support domestic producers of aluminium, zinc and silicon with state aid to ensure supplies of the metals crucial for the transition to low-carbon energy.

OTHER METALS: LME aluminium was back above $3,000 a tonne, helped by low inventories and risks to supply. It climbed 0.7% to $3,019 a tonne.