The slow Chinese economy triggers a fall in aluminium contract

According to a Bloomberg report, China, the biggest consumer of aluminium, revealed a dismal manufacturing data causing decline in industrial metals after an 18-month high.

There was a drop of 6% in the contract due for delivery in three months on the London Metal Exchange to $2,069 per metric ton at 3:54pm and was $2,069.50 at 3:54 p.m. Hong Kong time on 20th August. Prices finally closed at $2,076 which was the highest after 20th Feb last year.

The PMI readings clearly indicated a dip in the Chinese economy and Helen Lau, a Hong Kong-based UOB Kay HIan Ltd analyst, states that this dip will likely ‘dampen sentiments’ affecting metal demands.

The effects have also echoed in New York with December futures dropping by 0.6% reading as $3.178 a pound. The ones slated for October delivery however stood at 50,230 Yuan ($8,166) a ton up by 1.6% in Shanghai.