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Copper prices hit their lowest in two months on Tuesday as stockpiles in London Metal Exchange (LME) warehouses climbed to a six-month high amid a subdued demand outlook and stronger dollar.
Three-month copper on the LME was down 1% at $9,570 per metric ton during official rings, having earlier fallen as low as $9,551, its weakest since April 18, after exchange data showed a massive copper delivery of 19,175 metric tons to Asian locations.
Inventory at LME-approved warehouses rose to 155,850 tons, pointing to lackluster demand, data released on Monday showed.
"Copper has been hit the hardest by the fading hopes of a global manufacturing recovery," Julius Baer's Carsten Menke said.
Prices came under pressure from disappointing May industrial output from top consumer China and a slowdown of metals-intensive fixed asset investments, Menke added.
LME aluminium also dipped to $2,470 a ton, its lowest in nine weeks. It last traded 0.8% lower at $2,481.
"We think $2,450 is a good buying point. Aluminium's fundamentals are not bad in the medium term," a trader said.
China's aluminium imports jumped 61.1% in May, thanks to inflows from Russia, which is subject to Western sanctions.
Producers also offered to sell aluminum at premiums 25-31% higher than the current quarter to Japan, another major buyer of the light metal.
Japanese buyers were asked to pay premiums of $185 to $190 per metric ton for July-September primary metal shipments over the LME cash price, a sign of solid demand.
For other metals, nickel fell 1.3% to $17,240, zinc dropped 1.1% to $2,785, lead was flat at $2,155 and tin eased 0.5% to $31,995.
Depressing metals prices are a stronger U.S. dollar, which gained strength as traders awaited a U.S. retail sales report and comments from Federal Reserve officials to help gauge the timing of interest rate cuts.
(Reporting by Julian Luk in London; additional reporting by Mai Nguyen; Editing by Jan Harvey)