Three-month copper on the London Metal Exchange (LME) was up 0.2% at $9,059 a tonne by 1700 GMT after rising as much as 1.3% in earlier trade. U.S. consumer prices data for January showed the smallest annual increase since late 2021, raising hopes of less aggressive interest rate hikes by the Fed, initially spurring a weaker dollar and a rally in metals. Fed officials, however, warned that the central bank needs to prioritise quashing inflation over risks to growth and that rates may need to go higher than widely expected. That helped to strengthen the dollar , making commodities priced in the U.S. currency more expensive for buyers using other currencies. Copper surged last month to a seven-month peak of $9,550.50 a tonne, largely on bets that the lifting of China's strict COVID-19 controls would boost metals consumption. Many analysts, including analyst Geordie Wilkes at Sucden Financial, regard the rally as overblown because demand in top metals consumer China remains lacklustre. "The reopening of the Chinese economy has not led to more consumption of materials and seems to be more focused on the consumer," he said. "It would be tricky to see a sustained rally at this point." Copper has been supported recently by disruptions at mines, including at the Grasberg mine in Indonesia, which operator Freeport-McMoRan hopes can be partially restarted before the end of February. LME aluminium dipped 0.1% to $2,410 a tonne after LME data showed more inflows into LME-approved warehouses, with inventories having shot up by 54% in about a week. LME nickel shed 0.8% to $26,425 a tonne, zinc dipped 0.2% to $3,093 and tin retreated by 3.2% to $26,650, but lead added 0.1% to $2,099. For the top stories in metals and other news, click ($1 = 6.8201 yuan) (Reporting by Eric Onstad editing by Jason Neely and David Goodman)
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