(Adds analyst comment, updates prices and changes dateline to

London)

By Polina Devitt

LONDON, Aug 11 (Reuters) - Copper prices were steady on

Monday as Chile allowed mining to resume at Codelco's El

Teniente mine and the market awaited more clues on the path of

interest rates.

Benchmark three-month LME copper on the London Metal

Exchange was down 0.1% at $9,756 a metric ton by 0934 GMT. The

contract rose 1.4% last week.

Easing concerns on the supply side, Codelco said on Saturday

that Chile's state regulators had approved the reopening of

those parts of the El Teniente mine not affected by the July 31

collapse that killed six workers.

On the consumption front, Chinese producer prices fell more

than expected in July while consumer prices were unchanged,

highlighting sluggish domestic demand.

There are hopes that demand from China, the world's top

metals consumer, would improve in September, usually a peak

season, and that Beijing and Washington would again extend their

deadline to reach a trade deal.

The metals market was broadly quiet, waiting for a U.S.

inflation report this week that could help to determine whether

the Federal Reserve lowers borrowing costs next month, one

trader said.

Lower interest rates improve prospects for economic

growth-dependent industrial metals.

On the technical front, copper was supported by the 21 and

50-day moving averages around $9,735 to $9,740.

Among other LME metals, zinc was steady at $2,825 a

ton. However, the discount of the cash contract against

three-month zinc narrowed to 20 cents from $13 on

August 15, with available stocks in LME-registered warehouses at

a two-year low.

Aluminium lost 0.5% to $2,596.50 a ton, lead

eased by 0.3% to $2,001.50, tin was unchanged at

$33,450 and nickel was up 0.7% at $15,260.