METALS-Weaker dollar, Fed cut bets drive copper up

(Adds analyst comment, updates prices, changes dateline)

By Polina Devitt

LONDON, Oct 15 (Reuters) - Copper prices rose on Wednesday with support from a weaker dollar, expectations of more U.S. interest rate cuts and hopes for more stimulus in top metals consumer China.

Three-month copper on the London Metal Exchange added 0.9% to $10,673.50 a metric ton by 0939 GMT.

Inflow of investment into hard assets and worries about the reduced mine supply after disruptions in Indonesia, the Democratic Republic of Congo and Chile saw copper hitting its 16-month high of $11,000 on Oct. 9.

These disruptions have largely exhausted the allowance for unexpected production accidents which analysts added to their 2025 supply-demand balance estimates for the metal, used in power and construction.

"So, further changes between now and end-December could tighten the market," said Amy Gower, commodities strategist at Morgan Stanley.

The dollar got weaker as Federal Reserve Chair Jerome Powell left the door open to further rate cuts in his Tuesday's speech.

A weaker U.S. currency makes dollar-priced metals more attractive for buyers using other currencies, while the prospect of lower interest rates supports their industrial demand outlook.

In top metals consumer China, hopes for fresh monetary stimulus were high after data showed that deflationary pressures persisted in September, with both consumer and producer prices falling, amid a prolonged property market slump and trade tensions with the U.S.

Meanwhile, the premium for the LME cash copper contract against the three-month one continued to fall and was last at $37 a ton. It widened to $227, its highest since June, on Monday due to the activity ahead of Wednesday, when short position holders have to cut or rollover their contracts.

For zinc, the premium fell to $75 a ton from Monday's $202. Tight zinc stocks in the LME-registered warehouses - currently at their lowest level since early 2023 - make the LME contract vulnerable to price volatility, Gower said.

LME aluminium rose 0.4% to $2,747.50 a ton, zinc added 0.2% to $2,946.50, lead gained 0.6% to $1,994, tin jumped 0.9% to $35,465, while nickel climbed 0.3% to $15,175. (Reporting by Polina Devitt; Editing by Louise Heavens)