HANOI, March 9 (Reuters) - London copper fell on Tuesday as a firm dollar made greenback-priced metals more expensive for holders of other currencies, but analysts were optimistic about the metal's outlook due to U.S. stimulus and upcoming strong demand season in China.
Three-month copper on the London Metal Exchange declined 1.7% to $8,848.50 a tonne by 0634 GMT. Aluminium fell 2.1% to $2,124.50 a tonne and nickel shed 3.3% to $15,800 a tonne.
The dollar held near a 3-1/2-month high against its rivals as higher bond yields and expectations of faster economic normalisation from the COIVD-19 pandemic in the United States put the U.S. currency at an advantage.
A firmer dollar "to a certain extent put pressure on copper", said analysts at Huatai Futures in a note.
However, the outlook for copper prices remained strong thanks to the upcoming traditional peak season for Chinese consumption in the second quarter and the United States' $1.9-trillion stimulus bill plan, the analysts said.
FUNDAMENTALS
* Copper inventories rose to 84,250 tonnes, the highest
since Jan. 21, in LME warehouses
* The most-traded April copper contract on the Shanghai Futures Exchange closed down 0.7% at 66,000 yuan a tonne, aluminium fell 2.1% to 16,990 yuan a tonne while nickel dropped 3.4% to 119,240 yuan a tonne.
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PRICES
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin
ARBS (Reporting by Mai Nguyen; editing by Uttaresh.V and Aditya Soni)