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Copper prices were little changed on Friday after retreating from a two-week high in early trading on support from a weaker dollar and hopes that economic stimulus in top consumer China will boost demand.
Three-month copper on the London Metal Exchange was down 0.1% at $9,203 a metric ton in official open-outcry trading after touching $9,296 for its highest since Aug 30. The metal is up 2.5% over the week.
The U.S. currency was under pressure, making dollar-priced metals more attractive for buyers using other currencies, with the U.S. Federal Reserve widely expected to start cutting interest rates next week.
"One first rate cut is likely to boost sentiment in the base metals complex," said ING commodities analyst Ewa Manthey. "Longer term, weaker dollar and falling borrowing costs that will come with that cut will help demand, providing relief for construction and other interest-sensitive sectors."
In China, the central bank said on Friday that its policy would strive to expand domestic demand, focusing more on consumption. The country's new bank loans growth in August missed expectations, though total social financing numbers, a gauge of future metals consumption, exceeded a Reuters poll forecast.
Copper, used in power and construction, has lost 17% since a May rally to a record high of $11,104, helped by speculative buying on potential shortages resulting from future demand.
With the price fall, which was mainly because of the unwinding of investor positioning, Chinese buying has picked up and there has been some restocking activity ahead of China's long October holiday.
Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 45% over the past three months to 185,520 tons, the lowest since February.
Analysts at Macquarie expect copper prices to average $9,100 this quarter before recovering in the fourth quarter, subject to a decline in visible stocks.
In other metals, LME aluminium was up 0.2% at $2,421 a ton in official activity, lead lost 0.7% to $2,012, tin gained 1.4% to $31,850 while zinc was down 0.5% at $2,841 and nickel retreated by 1.9% to $15,975.
(Reporting by Polina Devitt in London Additional reporting by Mai Nguyen in Hanoi Editing by David Goodman)