(Replaces analyst comment; updates prices)
BEIJING, Jan 26 (Reuters) - Base metal prices on Friday
edged down from near multi-year peaks after U.S. President
Donald Trump backed a stronger dollar, prompting the currency to
trade above its recent lows.
A stronger dollar makes metals more expensive for holders of
other currencies. The greenback's recent weakness saw lead on
the London Metal Exchange touch $2,653 a tonne on Thursday,
highest since August 2011, while zinc hit a decade high of
$3,481.50, and nickel its highest since May 2015.
Trump's comments on the U.S. currency contradicted U.S.
Treasury Secretary Steven Mnuchin's earlier endorsement of a
weak dollar.
"As far as the metals are concerned it would seem that the
mainly Mnuchin-inspired reason for the rally has been if not
reversed certainly modified and as a result the ever-nervous
markets lost and may yet lose further ground," Malcolm Freeman,
CEO of Kingdom Futures, wrote in a note on Friday.
FUNDAMENTALS
* LME COPPER: Three-month copper on the LME was flat
at $7,139 a tonne at 0800 GMT, recovering from a 0.3 dip earlier
in the session. Copper is set for a weekly rise of 1.3 percent.
* SHFE COPPER: The most-traded March copper contract on the
Shanghai Futures Exchange closed down 0.2 percent at
53,430 yuan ($8,448.77) a tonne.
* SHFE METALS: "The previous day's bounce was too sudden.
After the prices rose, there are not many people looking to buy
high," says Xu Maili, director of non-ferrous metal research at
Everbright Futures in Shanghai.
* SHFE INVENTORIES: Copper inventories in warehouses
monitored by the ShFE fell 6.8 percent week-on-week, the
exchange said on Friday, while aluminium stocks rose to another
record high and ever-tight lead stocks shrank.
* NICKEL: Nickel was the sole gainer among base
metals, nudging up 0.2 percent in London, and climbing 1.1
percent in Shanghai, where it has clocked a weekly gain
of 7.8 percent on positive demand prospects in China.
* FREEPORT: Freeport-McMoRan Inc said it was edging
closer to a permit deal with Indonesia for its massive Grasberg
mine, but the world's second-biggest copper producer cautioned
that it has not yet struck any formal agreements.
* COLUMN: What does looming U.S.-China trade showdown mean
for aluminium?
* For the top stories in metals and other news, click
or
PRICES
BASE METALS PRICES 0800 GMT
Three month LME copper 7136
Most active ShFE copper 53430
Three month LME aluminium 2230.5
Most active ShFE aluminium 14625
Three month LME zinc 3455
Most active ShFE zinc 26180
Three month LME lead 2598.5
Most active ShFE lead 19470
Three month LME nickel 13800
Most active ShFE nickel 104340
Three month LME tin 21230
Most active ShFE tin 147040
BASE METALS ARBITRAGE
LME/SHFE COPPER LMESHFCUc3 794.68
LME/SHFE ALUMINIUM LMESHFALc3 -1748.26
LME/SHFE ZINC LMESHFZNc3 324.08
LME/SHFE LEAD LMESHFPBc3 -327.02
LME/SHFE NICKEL LMESHFNIc3 1052.13
($1 = 6.3240 Chinese yuan)
(Reporting by Tom Daly; Editing by Joseph Radford and Tom
Hogue)