London copper prices fell but remained in a tight range on Tuesday as investors and traders exercised caution ahead of a key rate decision in the United States due later in the week.

Three-month copper on the London Metal Exchange eased 0.1% to $8,549.50 per metric ton by 0301 GMT, while the most-traded March copper contract on the Shanghai Futures Exchange rose 0.1% to 69,020 yuan ($9,616.30) a ton.

The dollar maintained a narrow range against its major peers as traders awaited the Federal Reserve’s monetary policy decision, seeking clues on when the US central bank might cut rates.

While the Fed is expected to hold interest rates, the focus is on the tone that Fed Chair Jerome Powell will strike at the press conference on Wednesday and hints of potential rate cuts in the near future.

LME aluminium declined 0.5% to $2,253.50 a ton, nickel dropped 0.7% to $16,325, lead slipped 0.7% to $2,156.50 and tin eased 0.3% to $26,260, while zinc advanced 0.3% to $2,559.

SHFE aluminium declined 0.5% to 19,005 yuan, nickel dropped 2.4% to 127,200 yuan, zinc lost 0.5% to 21,310 yuan, lead eased 0.4% to 16,190 yuan and tin shed 1.1% to 218,640 yuan.

Copper dips as dollar steady, caution on China demand

Nickel is on track for a sixth consecutive monthly decline on both the LME and SHFE, due to pressure from a supply glut.

COMEX data showed net short positions on copper leapt to 30,839 contracts by Jan. 23, marking the highest level since March 2020, when the coronavirus pandemic was beginning to spread globally.