* Iron ore prices look overdue for correction - INTL
* Dollar ticks up after Federal Reserve official statement
* Rise in China iron ore port stocks drags on prices - ANZ
(Adds details and updates prices)
By Melanie Burton
MELBOURNE, Feb 7 Iron ore climbed on Tuesday
after steep losses in the previous session, with markets waiting
for fresh Chinese economic data for clues on the state of demand
in the world's top steel consumer.
Economic data in the coming weeks is expected to show the
world's second-largest economy got off to a good start in 2017,
with steady growth giving the central bank room to slowly
tighten monetary policy and contain the risks from high levels
of debt. Trade data is due on Friday.
The ferrous sector has come under pressure since the country
launched a surprise short-term rate hike last week, boosting
financing costs for holders of commodities, which are priced in
dollars. Steel prices slid more than 5 percent.
"We continue to feel that iron ore looks overbought and is
due for a correction, especially as it looks more likely that
China is interested in reining in things in given the short-term
interest rate hike," said INTL FCStone in a report.
China is expected to report on Tuesday that foreign exchange
reserves fell for the seventh straight month in January but at a
much slower pace as authorities tightened controls on capital
outflows and the surging U.S. dollar lost some steam.
The most-active rebar on the Shanghai Futures Exchange
climbed 2.2 percent to 3,165 yuan ($461) a tonne. In
the previous session, it closed down 6.8 percent, its weakest
since Jan. 10 at 3,062 yuan a tonne.
The dollar also edged up after Philadelphia Federal Reserve
Bank President Patrick Harker on Monday said he would be open to
raise interest rates again at the U.S. central bank's March
meeting if growth in jobs and wages continues.
Iron ore on the Dalian Commodity Exchange rallied
3.1 percent to 625 yuan ($91).
"Iron ore spot prices threatened to push below $80 a tonne
after data showed another strong rise in inventories of iron ore
held at Chinese ports," ANZ said in a note. China's iron ore
stocks at ports hit a record high last week. SH-TOT-IRONINV
"Stocks rose by 3.3 percent, or 3.9 million tonnes, to
123.45 million tonnes last week. This should come as no
surprise, with subdued demand around the holidays coming amidst
strong growth in supply."
Iron ore for delivery to China's Qingdao port
.IO62-CNO=MB fell 3.3 percent on Monday, according to Metal
($1 = 6.8764 Chinese yuan)
(Reporting by Melanie Burton; Editing by Joseph Radford and