LONDON - Copper prices rose in London on Friday, but were heading for their biggest weekly drop in five months due to concerns over sustained high interest rates, a firm dollar, and exchange inventories at their highest since May 2022.

Metals consumers, producers, traders and brokers will gather in London for LME Week next week, and markets in top metals consumer China will reopen after a week-long public holiday.

Three-month copper on the London Metal Exchange was up 0.9% at $7,968 per metric ton in official open-outcry trading. It is heading for a 3.6% weekly decline, its worst weekly performance since May.

Used in power and construction, copper has been hit in 2023 by weaker than originally expected demand growth in China and high global interest rates, a concern for construction activity outside of China.

However, it is widely expected to benefit from its role in the green energy transition in the long-term.

"The mood in the base metal markets has deteriorated again, with copper dropping back below $8,000 per tonne," said Julius Baer analyst Carsten Menke.

"The fundamental backdrop has not changed that much," he said. "We believe that the construction markets are remaining very resilient and that the backdrop in China has not changed."

Recent actual demand for copper and aluminium in China is quite robust due to the home appliance, electric vehicle, solar and wind sectors and despite the country's property sector crisis.

"Looking to year-end... copper may benefit from a pick-up in seasonal demand within China, further supported by the expectations for an acceleration within fiscal spending," said StoneX analyst Natalie Scott-Gray.

LME aluminium rose 0.3% to $2,238 a ton, zinc gained 0.9% to $2,498, lead was up 1.2% at $2,160, tin increased 1.1% to $24,415 and nickel added 0.2% to $18,525.

(Reporting by Polina Devitt in London; additional reporting by Mai Nguyen in Hanoi; Editing by Shailesh Kuber and Jan Harvey)