By Glenys Sim
Nov. 14 (Bloomberg) -- Copper jumped by the exchange- imposed daily limit in Shanghai, tracking moves in London, as a drop in the dollar may boost Chinese demand for raw materials.
The ICE futures exchange's U.S. Dollar Index, which tracks the greenback against six trading partners, fell for a second day ahead of a Group of 20 summit today. The metal used in wires and pipes also gained after Asian stocks rebounded as investors picked up bargains.
``China is the number one consumer of base metals,'' Larry Kantor, head of research at Barclay's Capital Inc., said today. ``I won't be surprised to see they are stepping up some purchases at these very attractive levels.''
Copper for January delivery on the Shanghai Futures Exchange rose by 1,150 yuan, or 4 percent, from the previous settlement price, to 30,020 yuan ($4,397) a metric ton, and traded at 29,880 yuan at 10:23 a.m. local time.
London Metal Exchange copper extended yesterday's 1.4 percent gain, rising as much as 4.9 percent to $3,850 a ton, and traded at $3,769 a ton.
Copper also rose on speculation China's central bank may cut interest rates this weekend, Wang Zheng, a trader at Everbright Futures Co. in Shanghai said.
China's State Council has said it will adopt a ``moderately loose'' monetary policy to expand government spending to sustain growth in the world's fourth-largest economy. The country's central bank Governor Zhou Xiaochuan said Nov. 9 that borrowing costs may be lowered after three reductions in the past two months.
Among other LME-traded metals, aluminum rose 0.7 percent to $1,950.50 a ton, and tin gained 2.9 percent to $14,100 at 10:31 a.m. Singapore time. Zinc fell 0.9 percent to $1,194 a ton, and nickel lost 0.4 percent to $11,400.
To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net
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