METALS-Copper eyes small weekly loss as stronger dollar drags

Fri Mar 6, 2015 2:55am EST
 
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* SocGen sees copper floor at $4,500 on oil, currency drop

* China nickel premiums jump as country shutters old NPI plants

* Lead enquiries pick up in Asia from secondary producers

* Coming Up: U.S. Nonfarm payrolls Feb at 1330 GMT (Adds comment, detail; updates prices)

By Melanie Burton

MELBOURNE, March 6 (Reuters) - London copper was headed for a weekly loss as a stronger dollar dented appetite for commodities, while traders said it was too soon after China's Lunar New Year break to determine the demand outlook in the world's top user of metals.

In the short term, the market is waiting for a key U.S. jobs report later that could pile more pressure on commodities if it supports the case for a rise in U.S. interest rates in coming months.

In the medium term, downside risk prevails, given a significant fall in the cost of production that could lower the floor price for copper, said analyst Mark Keenan of Societe Generale.

"For copper, the widely understood floor of $5,500 a tonne is actually $1,000 cheaper if you factor in the currencies and the oil price fall, which is a significant relaxation for people looking at cost floor dynamics as a gauge of potential price support," he said.   Continued...