LONDON - Copper prices came under pressure on Monday as focus shifted back to weakening demand, particularly in top consumer China, while negative sentiment was reinforced by a firmer dollar.

Benchmark copper CMCU3 on the London Metal Exchange (LME) was down 0.2% at $9,169 a tonne at 1106 GMT. Copper touched $9 257 on Friday, the highest since June 16, a gain of nearly 25% since end-September.

Traders said the softer U.S.-currency due to the prospect of a less aggressive stance on interest rates by the Federal Reserve had triggered speculative buying of dollar-priced industrial metals since the start of 2023.

"Copper prices are up sharply, but fundamentals still don't look great. You can see that in the physical market premium," said Liberum analyst Tom Price.

"Copper consumers and physical traders are probably thinking 'no, I'm not going to compete with speculators'. They will defer purchases and consumption."

Physical market premiums are paid above benchmark prices set on exchanges. The widely-watched Yangshan copper premium SMM-CUYP-CN was at $32.50 a tonne on Friday, down around 80% since last October.

Slowing industrial activity in China due to the Lunar New Year holiday next week is also expected to dampen demand.

Aluminium CMAL3 too hit a six-month high at $2,627 a tonne as a decisive break above the 200-day moving average helped create momentum. It was last up 1% at $2,620.

However, mounting surpluses will eventually curtail the rally, which has seen aluminium prices climb more than 15% so far this year.

"Aluminium prices are set to remain under pressure over the coming month as inventories build in the Chinese physical market," analysts at Citi said in a recent note.

Stocks of aluminium AL-STX-SGH in warehouses monitored by the Shanghai Futures Exchange at 166,741 tonnes are up 74% since end-December and at their highest since early November.

Zinc CMZN3 was up 0.4% at $3,337, lead CMPB3 slipped 0.2% to $2,247, tin CMSN3 fell 0.5% to $28,625 and nickel CMNI3 gained 0.9% to $27,050.

Focus in the nickel market is on some very large long and short positions 0#LME-FBR that may be squared or rolled over ahead of settlement on Wednesday.