LONDON, Jan 13 (Reuters) – Copper prices halted their rally on Friday but headed for a 6% weekly gain on hopes of a weaker dollar and the unwinding of COVID-19 restrictions in China will drive demand.
* Other industrial metals were also heading for weekly gains, with aluminum, zinc and tin all up 9-14% since last Friday.
Benchmark copper was down 0.3% at $9,157 a tonne at 1150 GMT, after hitting a seven-month high of $9,240 on Thursday.
* China’s zero-COVID policy stifled demand for metals from the world’s biggest consumer. However, the abandonment of these measures has caused a wave of COVID-19 infections that will probably continue for two to three months.
* “(But) most investors are seeing through that turbulence the potential for Chinese demand for copper to rise markedly,” said Nitesh Shah, an analyst at WisdomTree. “More than $10,000 (a ton) should be easily within reach,” he said, adding that copper supplies are likely to remain tight this year.
* China’s copper consumption in 2023 is projected to rise 4.4% to 14.8 million tonnes, Fitch Solutions Country Risk and Industry Research said.
* However, near-term demand remains weak, with copper, aluminum, zinc and lead stocks on the Shanghai Futures Exchange rising sharply in the week to Friday.
* Meanwhile, the dollar fell to its lowest level since June after a slowdown in US inflation reinforced expectations that the Federal Reserve’s rate hikes will end soon.
* The weaker dollar makes dollar-denominated metals cheaper for buyers with other currencies.
* Benchmark zinc was up 1.9% at $3,298 a tonne as stocks at LME-registered warehouses fell to a low of 20,975 tonnes on record and below nearly 300,000 tonnes in early 2022.
* Tin was up 5.3% at $28,865 after a major mine in Peru suspended operations.
* Meanwhile, aluminum was unchanged at $2,548.50 per ton; nickel was up 2.8% at $27,775; and lead was down 0.2% at $2,194. (Reporting by Peter Hobson, Additional reporting by Siyi Liu and Dominique Patton, Editing in Spanish by Manuel Farías)