London - Copper was little changed, after hitting a near two-week high earlier on Monday, as a strong dollar and worries over rising supplies offset a deal over Tehran's disputed nuclear programme that is expected to boost global growth.

The dollar was up against the euro and a basket of currencies, making dollar-priced metals costlier for non-US investors.

Iran reached a deal with six world powers on Sunday to curb its nuclear programme in exchange for some relief on sanctions.

Oil prices fell by around $2 a barrel, which boosted appetite for shares and other risky assets on the view that weaker oil prices will be a net plus for spending power globally.

Copper prices were undermined, however, by pervasive worries over rising supplies.

Data from the International Copper Study Group have shown that the global copper market swung to a 21,000 tonne surplus in August, rising after three straight months of deficit.

“We think the copper market has a problem with supplies continuing to increase despite the lower prices and the lackluster demand outlook. We expect prices to end the year at $6,750 a tonne,” said Tom Pugh, an analyst at Capital Economics.

Benchmark three-month copper on the London Metal Exchange dipped 0.14 percent to $7,085 a tonne by 12:16 SA time, after

earlier hitting its highest level in nearly two weeks at $7,140 a tonne.

Copper has been underpinned by a fall in physical supply in Asia and expectations China's economic reforms will support an improvement in global demand next year.

However, the metal is still down some 10 percent for the year.

In the United States, worries that the Federal Reserve will soon start to scale back its bond-buying programme have continued to ease as investors take the view that tapering does not mean official interest rates will rise soon afterwards.

Solid U.S. data last week pointed to a gradually improving outlook for 2014, albeit with less money-printing.

“Leading economic indicators have mostly surprised to the upside, so cyclical markets such as industrial metals and oil are likely to be better supported than interest rate-sensitive precious metals,” said Credit Suisse in a note.

Investors were awaiting a raft of housing reports from the United States to further gauge its economic outlook.

But trading also was expected to calm down this week ahead of the US Thanksgiving holiday on Thursday.

Helping support copper meanwhile, cash prices traded at a premium of $3 a tonne to three-month prices on Friday, LME data showed.

The data also showed copper stocks fell 1,600 tonnes to 437,500 tonnes, their lowest point since early February this year.

China's importers of refined copper face a shortfall of about 30,000 tonnes this month and the next as a typhoon-hit Philippine smelter delays metal deliveries, supporting spot premiums near four-year highs.

In other metals traded, aluminium fell 0.11 percent to $1,780 a tonne, having last week hit its lowest level since July.

Russia's United Company Rusal, the world's biggest aluminium producer, said it had offered January-March shipments of the metal to Japanese buyers at a premium of $270 per tonne, seeking a record high.

Malaysia's biggest aluminium maker Press Metal Bhd expected output to rise 36 percent to 410,000 tonnes next year after restarting one of its two plants, a company executive said on Monday. - Reuters