HANOI, April 20 (Reuters) – Copper prices rose back towards their highest in a decade on Tuesday, as a weaker dollar made greenback-denominated metals cheaper and more attractive to holders of other currencies.
Three-month copper on the London Metal Exchange rose as much as 1.1% to $9,483 a tonne, flirting with the $9,617-a-tonne level hit in February which was its highest since August 2011. By 0716 GMT it was at $9,426.50, up 0.5%.
The most-traded June copper contract on the Shanghai Futures Exchange rose as high as 69,750 yuan ($10,737) a tonne, not far from its February peak of 71,080 yuan a tonne, which was its highest since March 2011. It closed up 1.1% at 69,450 yuan a tonne.
The dollar wallowed near a six-week low against its peers as U.S. bond yields hovered below a 14-month peak touched last month.
“Copper is riding the wave of the U.S. dollar debasement in value,” said a Singapore-based metals trader, but noted that “physical participants are not biting (at current prices)”.
“Watch the inventories. Already there’s lending guidance on copper,” said the trader, referring to the dominant warrant holders in LME copper short-term contracts.
One participant currently holds 50-80% of LME copper warrants.
($1 = 6.4963 yuan)
(Reporting by Mai Nguyen; Editing by Shounak Dasgupta, Shailesh Kuber and Jan Harvey)