February 8, 2025
SMM forecast for the copper market this week

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In China, the Ministry of Finance, the China Securities Regulatory Commission and three major exchanges announced major policy adjustments, including stamp duty policies, IPOs, refinancing, financing and shareholding reduction. Listed real estate companies will not be restricted from refinancing even if their stock prices fall below the issue price or net asset value per share, or even if they incur losses. In addition, during the week, several Chinese cities officially announced that the mortgage would be treated the same as a first mortgage for a buyer who does not own a home locally, even if the buyer has already moved to other areas. I have bought a house. China. This further boosted domestic consumption.

Abroad, the United States reduced its second quarter GDP growth to 2.1% from the previous 2.4%. This lowered market expectations about US inflation. On the other hand, the limited downside correction suggests that the US economy is still resilient and expectations of a soft economic landing remain strong. The ADP reported that the US added 177,000 new jobs in August, the smallest increase in five months and well below the expected 195,000. A cold US job market has undermined the credibility of Fed Chairman Powell’s suggestion at the global central bank’s annual meeting that the US could raise interest rates again this year. In the Eurozone, the Economic Sentiment Indicator and Consumer Confidence Index for August released last week showed that economic confidence in the Eurozone has deteriorated and the Eurozone economy is likely to stagnate in this quarter. Slightly higher than expected inflation rates in Germany and Spain due to rising energy prices raised the prospect that the European Central Bank will raise interest rates again in September. Fundamentally, the rise in copper prices reduced buying interest from downstream consumers last week, limiting new orders. However, copper inventories in key markets in China are at record low levels, yet copper prices have found some support.

As the domestic demand is still weak, favorable domestic policies are unlikely to lead to a significant increase in copper prices. US dollar index is unlikely to decline sharply in the near term, which will limit the upside in copper prices. In view of low copper inventories, resilient domestic economy and upcoming peak season from September to October, SHFE copper prices are expected to move higher this week to between 68,000-70,000 Yuan/MT, and LME copper prices to $8,300-8,450 per ton Will remain In the domestic spot market of Mt China, the spot premium will rise to 300-600 Yuan/MT this week, despite pressure from imported cargoes.

Source: www.bing.com

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