LONDON: Copper prices slipped on Monday as rising inventories and a stronger dollar spurred selling, but China’s pledge to front-load infrastructure investment next year capped losses.

Benchmark copper on the London Metal Exchange (LME) was down 0.7% at $9,442 a tonne at 1704 GMT.

“The copper stock situation seems to be easing,” one metals trader said, adding that the dollar’s performance was also behind some of the selling.

STOCKS: Copper inventories in LME-registered warehouses started to rise last week and have reached 84,450 tonnes, while on-warrant stocks - metal available to the market - stands at 78,300 tonnes, up from 15,225 tonnes in the middle of October.

Receding fears about copper supplies on the LME market are behind the narrowing of the premium for cash metal over the three-month contract to near zero from more than $1,100 in mid-October.

DOLLAR: A stronger US currency makes dollar-denominated metals more expensive for holders of other currencies, which could subdue demand.

A meeting of the US Federal Reserve this week could boost the dollar further if the central bank decides to take a more hawkish stance on the unwinding of its bond-buying programme and the timing of interest rate rises.

CHINA: The top consumer of industrial metals said it will implement new tax and fee cuts, front-load infrastructure investment next year and support key areas such as employment, financing, trade and investment.

Industrial production and investment data due this week will yield clues to Chinese demand prospects.

TECHNICALS: Copper is struggling to hold above the 100 and 200-day moving averages, currently about $9,500. A decisive break below that could provide momentum for a sell-off.

ZINC: Stocks of zinc in LME-registered warehouses rose 26,475 tonnes to 190,900 tonnes, up about 25% since last week.

Rising inventories have eased worries about zinc supplies and helped to narrow the premium for cash metal over the three-month contract.

Three-month zinc was little changed at $3,328 a tonne.

OTHER METALS: Aluminium was up 2% at $2,659 a tonne, lead rose 0.4% to $2,295, tin fell 1.6% to $38,750 and nickel ceded 0.1% to $19,720.