Shanghai copper fell 1 percent yesterday, after China's central bank signaled another move to tighten monetary policy and the dollar gained, but sentiment was still supported by strong demand outlook.

The US dollar hit a five-month high against the euro on continued concern about Greece's fiscal problems and after breaking below a key chart level that could signal a bearish trend for the currency.

Banking authorities have instructed some major banks to halt their lending during the rest of January after a burst of credit in the first couple of weeks, media and banking sources said.