METALS-Copper rises as dollar slides, China loosens COVID curbs

(Updates prices)

Dec 1 (Reuters) - Copper prices on Thursday climbed to their strongest in two weeks, supported by a weaker dollar and signs that top metals consumer China was shifting away from its stringent COVID-19 curbs policy.

Three-month copper on the London Metal Exchange was up 1% at $8,321.50 a tonne, as of 0700 GMT. It had earlier scaled a two-week peak of $8,363.

On the Shanghai Futures Exchange, the most-traded January copper contract rose 1.7% to 65,890 yuan ($9,332.46) a tonne. Earlier in the session, it hit 66,050 yuan, its highest since Nov. 18.

China is softening its

tone

on the severity of COVID-19 and easing some coronavirus restrictions even as its daily case toll hovers near record highs.

"We believe that Chinese authorities are shifting to a 'living with COVID' stance, as reflected in new rules that allow people to do 'home isolation' instead of being ferried away to quarantine facilities," ANZ analysts said in a note.

The dollar index extended Wednesday's more than 1% drop, dipping 0.28% to 105.48, making greenback-priced metals cheaper for buyers using other currencies.

"Remarks from U.S. Federal Reserve Chair Jerome Powell were received positively by markets, setting off a rally in bond markets and a sell-off in the U.S. dollar," ANZ analysts said.

Powell signalled on Wednesday it was time to slow the pace of coming interest rate hikes following the Fed's aggressive tightening moves to curb inflation.

LME aluminium was little changed at $2,476.50 a tonne, zinc added 1.1% to $3,069.50, tin climbed 0.8% to $23,100, while lead slipped 0.5% to $2,181.50.

SHFE aluminium rose 1.5% to 19,125 yuan a tonne, nickel climbed 1.9% to 202,440 yuan, zinc advanced 2.9% to 24,500 yuan, tin gained 0.9% to 186,760 yuan, and lead edged up 0.1% to 15,750 yuan.

($1 = 7.0603 yuan) (Reporting by Enrico Dela Cruz in Manila; Editing by Nivedita Bhattacharjee and Eileen Soreng)