BEIJING, Feb 1 (Reuters) - Copper prices edged higher on Wednesday ahead of the Federal Reserve's policy decision, with investors also awaiting post-holiday demand pick-up in top consumer China.

Three-month copper on the London Metal Exchange was up 0.1% at $9,229.50 a tonne, as of 0717 GMT. The most-traded March copper contract on the Shanghai Futures Exchange closed day trading 0.4% higher at 69,700 yuan ($10,332.05) a tonne.

The Fed is widely expected to raise interest rates by 25 basis points at the conclusion of its two-day policy meeting later in the day. Investors will closely monitor comments from Fed Chair Jerome Powell too.

Physical demand in China was muted as producers held sufficient stocks that they built up before the Lunar New Year holidays, and as consumption from end users remained weak amid a slowdown in orders from both domestic and overseas markets, participants said.

"There will be more activities next week when more traders and buyers come back," a Chinese trader said.

The muted trading has led to a steep rise in inventories for refined copper readily available in the market. Inventories rose to 267,500 tonnes on Jan. 30, an increase of 80,800 tonnes from Jan. 19, according to local information provider Mysteel.

Still, investors were optimistic about industrial metals demand prospects as the world's top consumer vowed to support its economy and the real estate sector.

"So far, interest from Chinese traders has been muted," said ANZ Research, adding that sentiment, however, was boosted after China's January official manufacturing purchasing managers' index (PMI) expanded for the first time since September 2022.

Meanwhile, the Caixin/S&P Global PMI showed China's factory activity shrank more slowly in January after Beijing lifted tough COVID curbs late last year.

Among other metals, LME aluminium shed 0.5% to $2,631 a tonne, zinc advanced 0.9% to $3,418.50, tin was up 1.2% at $29,830, and lead gained 0.9% to $2,155.

SHFE aluminium climbed 1.3% to 19,150 yuan a tonne, tin gained 0.5% to 236,550 yuan, lead moved up 0.3% to 15,270 yuan, while nickel rose 1.8% to 225,410 yuan.

For the top stories in metals and other news, click or ($1 = 6.7460 Chinese yuan) (Reporting by Siyi Liu and Dominique Patton; editing by Uttaresh.V and Subhranshu Sahu)