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METALS-Aluminium buoyed by low stocks, China data; Fed decision in focus

    (Updates prices)
    By Brijesh Patel
    June 15 (Reuters) - London aluminium prices edged higher on
Wednesday from a seven-month low, buoyed by dwindling
inventories and strong industrial output data from China, while
traders watched to see how aggressively the U.S. central bank
would hike rates.
    Three-month aluminium on the London Metal Exchange
was up 0.2% at $2,575 a tonne, as of 0704 GMT, after hitting its
lowest since Nov. 10 on Tuesday.
    The most-traded July aluminium contract in Shanghai
ended daytime trading 0.8% lower at 19,805 yuan ($2,949.15) a
tonne.
    "The stronger China data caught the market by surprise and
while certainly not a blockbuster, the industrial production
beat suggests China has become very agile at keeping the export
engines revving despite mobility restrictions," said Stephen
Innes, managing partner at SPI Asset Management.
    China's industrial output rose 0.7% in May from a year
earlier, picking up from a 2.9% decline in April, official data
showed. China's monthly production of aluminium reached a record
high last month.
    China's central bank kept its medium-term policy rate
unchanged for the fifth straight month.

    INVENTORIES: Aluminium stocks in
LME-registered warehouses were at a 21-year low of 420,675
tonnes, compared with nearly 2 million tonnes in March 2021.
    Stocks in warehouses monitored by the Shanghai
Futures Exchange have dropped more than 20% since the middle of
March to 269,583 tonnes.
    U.S. FED: Investors have dramatically raised their bets that
the Fed will raise interest rates by 75 basis points (bps)
rather than 50 bps on Wednesday.
    "The Fed can't do anything about soaring commodities due to
the war but what it can do is impact demand via higher interest
rates," Innes said.
    Russia's invasion of Ukraine has seen oil prices rise more
than 50% since January.
    COPPER: Workers at Chilean state-owned Codelco, the world's
largest copper producer, threatened on Tuesday to go on a
company-wide strike due to a lack of investment at the mining
firm's troubled Ventanas smelter and refinery.
    OTHER METALS: LME copper         was steady at $9,235 a
tonne, zinc         rose 0.6% to $3,619.50, lead         added
1.1% to $2,098, nickel         was flat $25,260, and tin
added 2.1% to $31,735.
    Shanghai copper          was down 1%, zinc          eased
0.3%, nickel          fell 1.8%, lead          edged 0.1% lower,
and tin          rose 1.8%.


($1 = 6.7231 Chinese yuan)

 (Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu
Sahu)



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