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US copper ends off highs as dollar outweighs strike

NEW YORK, June 30 (Reuters) - U.S. copper futures eked out modest gains by the close Monday as a rebound in the dollar eroded some of the day's earlier momentum tied to labor issues in Peru, the world's second-largest producer of the red metal.

Copper for September delivery HGU8 ended up 0.45 cent at $3.8825 a lb on the the New York Mercantile Exchange's COMEX division.

The session range was from $3.8325 to $3.9130, the contract's highest level since its May 5 peak at $4.22.

Front-month July HGN8 rose 1.15 cents to $3.8955, after dealing between $3.8445 and $3.9190.

Open interest edged up 15 lots to 109,435 open contracts as of June 27.

The largest federation of mining unions in Peru said on Monday a nationwide strike has begun in the country, which mined over 1 million tonnes of copper last year.

The U.S. dollar rebounded against the euro on Monday as traders adjusted their portfolios at the end of the quarter. The greenback's gains may be limited ahead of an expected rate hike in the euro zone this week.

A stronger American currency tends to make dollar-denominated assets like copper more expensive for holders of foreign currencies.

On the production front, Chile produced 463,233 tonnes of the metal in May, down 3.8 percent from the same month last year, the government said on Monday. Chile provides around a third of the world's copper.

London Metal Exchange copper warehouse stocks declined 300 tonnes to 122,600 tonnes on Monday-- down nearly 40 percent since the start of the year. Trade data from the Commodity Futures Trading Commission showed a fresh upward swing in net long posotions in U.S. copper future.

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