SHANGHAI, July 4 (Reuters) - London copper edged down on Wednesday on a stronger dollar and as investors began to wonder if recent measures announced by European leaders were enough to tackle the euro zone debt crisis.
Trading is expected to remain cautious ahead of a European Central Bank meeting on Thursday, which may now have to produce more than a sharp interest rate cut to ease market doubts over the ECB rescue fund's ability to lower borrowing costs for indebted members such as Spain.
Three-month copper on the London Metal Exchange had fallen 0.6 percent to $7,772 per tonne by 0138 GMT, after hitting a 7-week high on Monday and ending that session up 2.5 percent.
The most-active October copper contract on the Shanghai Futures Exchange edged up 0.2 percent to 56,190 yuan ($8,800) per tonne, stretching gains into a fifth session.
The ECB is expected to cut interest rates to a record low on Thursday but may need to do more to satisfy financial markets already starting to wonder about the solidity of last week's summit measures to tackle the debt crisis.
The International Monetary Fund on Tuesday urged the United States to quickly remove the uncertainty over the path of fiscal policy, which is set to tighten abruptly at the start of next year without congressional action. Managing Director Christine Lagarde also warned that the potential for a political showdown over the U.S. budget and debt ceiling could shake confidence worldwide.
France's new Socialist government slashed the economic growth forecasts of the euro zone's second largest economy on Tuesday, paving the way for a slew of cuts that are bound to anger many voters after President Francois Hollande promised to avoid austerity.
Asian shares rose on Wednesday as investors kept hopes high for more monetary policy stimulus to support the faltering global economy, but trading may be subdued with U.S. markets closed for the Independence Day holiday.
The U.S. dollar rose on Wednesday after a string of weak data out of the United States and Europe spurred expectations of more stimulus from both the ECB and Federal Reserve.
0758 EZ Markit Services PMI Jun 2012
0230 China HSBC Services PMI June
Base metals prices at 0138 GMT
Metal Last Change Pct Move YTD pct chg
LME Cu 7772.00 -46.00 -0.59 2.26
SHFE CU FUT OCT2 56190 90 +0.16 1.01
LME Alum 1969.00 -14.00 -0.71 -2.52
SHFE AL FUT OCT2 15625 125 +0.81 -1.36
HG COPPER SEP2 353.30 -0.70 -0.20 2.82
LME Zinc 1896.00 -10.00 -0.52 2.76
SHFE ZN FUT OCT2 14870 20 +0.13 0.51
LME Nickel 17160.00 -130.00 -0.75 -8.28
LME Lead 1910.00 -29.00 -1.50 -6.14
SHFE PB FUT 14980 10 +0.07 -2.03
LME Tin 19100.00 -150.00 -0.78 -0.52
LME/Shanghai arb 1537
Shanghai and COMEX contracts show most active months
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE third month
($1 = 6.3523 Chinese yuan)