Oct 24 (Reuters) - Prices of most base metals increased on Tuesday as a softer U.S. dollar made greenback-priced commodities cheaper to holders of other currencies.
Three-month copper on the London Metal Exchange rose 0.7% to $8,025.50 per metric ton by 0642 GMT, while the most-traded December copper contract on the Shanghai Futures Exchange advanced 0.9% to 66,520 yuan ($9,104.97) a ton.
The dollar softened against a basket of currencies, mirroring a dip in U.S. Treasury yields as investors awaited key U.S. economic data before the Federal Reserve's monetary policy meeting next week.
"U.S. bond yields and the U.S. dollar have fallen, reducing pressure on nonferrous metals," said Jinrui Futures in a report, adding that China's state fund Central Huijin Investment buying exchange-traded funds boosted market confidence.
Tight copper scrap supply, coupled with falling refined copper prices, have improved consumption of the metal, but not significantly, the report said, noting that a bearish macroeconomic outlook will continue to pressure copper prices.
LME aluminium increased 0.4% to $2,184.50 a ton, nickel rose 0.8% to $18,320, zinc advanced 0.7% to $2,437.50, lead was up 0.5% at $2,113.50 and tin were 0.5% higher at $25,025.
However, the cash contracts for five out of six base metals on the LME were trading at a premium to their corresponding three-month contracts, indicating ample near-term supplies.
All base metals except tin were headed for a monthly decline in October.
LME copper inventories
SHFE aluminium was flat at 18,905 yuan a ton, nickel fell 0.9% to 147,380 yuan, lead lost 0.3% to 16,475 yuan, tin was almost unchanged at 214,900 yuan, while zinc rose 0.7% to 21,090 yuan.
($1 = 7.3059 yuan) (Reporting by Mai Nguyen in Hanoi; Editing by Subhranshu Sahu and Janane Venkatraman)
