* Inventories downward trend offsets US macro data

* Coming up: U.S. FOMC result at 1815 GMT

(Recasts, adds comment, detail)

By Michael Taylor and Pratima Desai

LONDON, Aug 9 (Reuters) - Copper prices marched up on Monday boosted by expectations of healthy demand from top consumer China, a weaker dollar and sliding inventories.

Benchmark copper CMCU3 on the London Metal Exchange was trading at $7,454 a tonne at 1415 GMT from $7,370 at the close on Friday. The metal used extensively in power and copper earlier hit a high of $7,489 a tonne.

Market focus was on comments from a leading Chinese government economist, who said China's economy will enjoy a strong, stable second half, putting it on course for full-year growth of about 10-11 percent. [ID:nTOE67800E]

"Demand looks healthy, especially out of China, the dollar is weaker and stocks are falling," said Edward Meir, analyst at MF Global, adding that most of the rally in base metal prices had probably already been seen.

"It may be hard maintaining levels above $7,500."

China is the world's largest copper consumer accounting for more than 30 percent of the global market estimated at around 19 million tonnes this year.

The market is waiting for a raft of data from China this week, including July imports and exports.ECONCN

However, traders said there were doubts about the strength of demand for industrial metals in the United States, the world's largest economy, after a weak monthly jobs report suggested growth could be faltering. [ID:nN05598486]

That is one reason why the dollar was weaker, making metals cheaper for holders of other currencies. [USD/]

Investors are also looking ahead to Tuesday's Federal Reserve meeting. [ID:nN09301078]

"The Fed could leave policy unchanged, with just minor changes to the statement to acknowledge the fact that the economy has struggled recently," said Standard Bank in a note.

"A second option is to make minor tweaks to policy ... "Alternatively, the Fed could be bold by, for instance, re-engaging quantitative easing with some new target set for bond purchases."

ALUMINIUM CONTANGO NARROWS

Aiding overall sentiment in recent months has been a growing trend of falling LME inventories and cancelled warrants -- material earmarked for delivery from LME warehouses.

Copper stocks fell 2,150 tonnes to 410,475 tonnes, having fallen from 6-1/2 year highs at 555,075 tonnes in mid-February.

Aluminium CMAL3 was trading at $2,206 from Friday's last bid at $2,190. LME stocks for the metal, used in transport and packaging, slipped 6,025 tonnes to 4.39 million tonnes after hitting a record high above 4.6 million in late January.

A large portion of those aluminium stocks are tied up in finance deals. [ID:nGEE5BA277] <0#LME-STOCKS>

Worries about near-term supplies have narrowed the contango -- the discount between the cash and three-month contracts MAL0-3 -- to about $9 a tonne, from $33 a tonne mid-June.

Stainless steel ingredient nickel earlier touched $22,814 a tonne and zinc hit $2,175 -- their highest level since May 13.

Zinc CMZN3 was last at $2,161 a tonne from $2,129 on Friday and nickel CMNI3 at $22,687 from $22,075.

Colin Hamilton, analyst at Macquarie said the current nickel prices may not be sustainable.

"We are seeing the rising nickel price reincentivise some nickel pig iron production in China ... and the stainless steel market is softening

Battery material lead CMPB3 was trading at $2,205 a tonne from $2,165 on Friday and tin CMSN3 at $21,000 from a last bid at $20,725 on Friday.

Zinc cancelled warrants as of Friday were at 64,575 tonnes compared with 20,150 tonnes on Aug. 4, or 10 percent or total LME stocks at 617,700 tonnes.

Tin cancelled warrants account for 10 percent of total LME stocks at 14,895 tonnes. It earlier touched $21,500, its highest level since August 2008. Prices are up 26 percent so far this year. Higher levels are expected. [ID:nLDE66I1UK]

Metal Prices at 1413 GMT

Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2009 Ytd Pct

move COMEX Cu 337.80 3.50 +1.05 334.65 0.94 LME Alum 2201.00 -2.00 -0.09 2230.00 -1.30 LME Cu 7450.00 80.00 +1.09 7375.00 1.02 LME Lead 2195.00 30.00 +1.39 2432.00 -9.75 LME Nickel 22635.00 560.00 +2.54 18525.00 22.19 LME Tin 20900.00 425.00 +2.08 16950.00 23.30 LME Zinc 2155.00 26.00 +1.22 2560.00 -15.82 SHFE Alu 15615.00 55.00 +0.35 17160.00 -9.00 SHFE Cu* 58250.00 440.00 +0.76 59900.00 -2.75 SHFE Zin 17610.00 335.00 +1.94 21195.00 -16.91 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07

(Editing by Alison Birrane)

Source: http://www.reuters.com/article/idUSLDE6780RY20100809