London copper rises on China lending rate cut, upbeat U.S. housing data

• Copper, widely used in construction and power, nonetheless remained on course for a 2.6% drop this week.
• London copper prices rose on Friday after top metals consumer China further cut benchmark lending rates and U.S. data showed August home resales rising to a 17-month high.
• Three-month copper on the London Metal Exchange  was up 0.6% at $5,820.50 a tonne as of 0706 GMT.

China lowered its new one-year benchmark lending rate for the second month in a row on Friday, to 4.20%, as the central bank seeks to guide borrowing costs lower to support the slowing economy.

Copper, widely used in construction and power, nonetheless remained on course for a 2.6% drop this week, which would mark its steepest weekly fall since the week ended Aug. 2 amid concerns over tepid demand in China.

"Regarding copper, a drop in Chinese demand has loosened the global market, while sentiment continues to worsen," Fitch Solutions said in a note.

The research house has cut its average price forecast for copper to $5,900 a tonne this year and $5,700 in 2020, from previous views of $6,300 a tonne and $6,600 a tonne respectively.

FUNDAMENTALS

* COPPER: Three-month copper on the London Metal Exchange  was up 0.6% at $5,820.50 a tonne as of 0706 GMT. The most-traded November copper contract on the Shanghai Futures Exchange closed flat at 47,120 yuan ($6,650.95) a tonne.

* PERU OUTPUT: Peru expects its copper production to grow 27% and gold output to expand 12% in the next three years, the country's energy and mines minister said.

* OTHER METALS: The LME complex turned broadly higher in Asian afternoon trade, with nickel and tin rising 1.4% and 1.1% respectively. Fitch Solutions raised its 2019 average nickel price forecast from $13,250 a tonne to $13,550.

* NICKEL: The global nickel market deficit widened to 6,700 tonnes in July from a revised 2,700 tonnes in the previous month, the International Nickel Study Group (INSG) said on Thursday.

The premium of LME cash nickel over the three-month contract <CMNI0-3> stood at $150 a tonne, near the recent decade high of $163, indicating near-term tightness.

* COLUMN: Shanghai nickel surge morphs into London squeeze: Andy Home

* RARE EARTHS: U.S. President Donald Trump and Australian Prime Minister Scott Morrison are set to release a plan on Friday to secure the supply of rare earth minerals, a senior administration official said.

Concerns have grown that China could cut off shipments of the prized commodities.