Aluminium hits its highest in three weeks while other metals falter

Aluminium has hit its highest in nearly three weeks after data showed that China's factory sector grew for the first time in nine months, but other metals faltered after US jobs data raised the prospect of further interest rates increases.

US employment increased solidly in March and wages rebounded, weighing on other base metals such as copper, which briefly touched a four-week low. While some analysts said the Federal Reserve would remain cautious about raising rates due to slowing global growth, others said the upbeat data made rate increases more likely.

"I think the strength of payrolls suggest the Fed will undoubtedly raise rates this year, likely in June," David Carter, chief investment officer at Lenox Wealth Advisors in New York, said.

Aluminium prices gained after the official Chinese Purchasing Managers' Index (PMI) unexpectedly rose to 50.2 in March, beating forecasts and above the 50-point mark that separates growth from contraction. Three-month aluminium on the London Metal Exchange closed up 1.1 per cent at $US1,536 a tonne after touching an intraday peak of $US1,547, its highest level since March 14.

Some analysts were cautious, however, about PMI data in China, the world's top metals consumer, accounting for 45 per cent of global copper demand.

"Our economists believe it's mainly due to seasonal factors. There are some signs of a stabilizing Chinese economy, but it's too early to talk about any lasting recovery," Commerzbank analyst Daniel Briesemann in Frankfurt said.

Also weighing on metals were downbeat data from Japan, where business sentiment among big manufacturers deteriorated to the lowest in nearly three years, and weak factory growth in the euro zone.