Aluminum prices dropped 2.67%

Aluminum prices dropped in four consecutive trading days until Tuesday (14/5). Decline in aluminum prices along with other industrial metals prices drop in the past week. Only tin which recorded an increase in price.

Price of aluminum for delivery in three months on the London Metal Exchange (LME) was at U.S. $ 1,857 per tonne on Tuesday (14/5). This figure is down 0.54% compared to the previous day.

In the last four days, the price of aluminum fell 2.67%. This industrial metal prices declined 10.41% since the end of 2012 and at U.S. $ 2,073 per metric ton.

This week, there is some information concerning the revision of economic growth in developed countries and global economic growth, so it can be a little prop strengthening aluminum prices. Some industrial metal prices fell after Bank of America Merrill Lynch cut its forecast for China's economic growth of 8% to 7.6% this year and from 7.7% to 7.6% next year.

This follows cuts growth forecast for China's growth forecast cut by JPMorgan Chase & Co.. "The number of gross domestic product (GDP) is bad in Germany and France, coupled with cuts in projected GDP growth of China is pressing the metals market," said Pengjian Fu, Director of Commodity Trading Asia at Newedge Group SA told Bloomberg.

Prime Minister of China, Li Keqiang gives a signal that the government is reluctant to use the stimulus to counter the slowdown in the country with world's second largest economy. You see, the stimulus will be greater risks than benefits.

"To achieve the target this year, we had to rely on market mechanisms, space for relying on government stimulus or direct investment is very small," said Li. Last March, China pegged the economic growth this year at the rate of 7.5%, the same as last year's economic growth.

Meanwhile, France enters recession as two quarters of negative growth in a row in the first quarter of 2013. Based on data from Eurostat, Wednesday (15/5), the GDP of 17 countries that use the euro -1% recorded in the first quarter of 2013, compared to the same period last year. Euro zone GDP down 0.2% compared to the fourth quarter of 2012.

Aluminum prices also dragged China's April inflation data that showed an increase, to 2.4% over the same period last year. Ting Lu, an analyst at Bank of America Merrill Lynch said, China is unlikely to cut interest rates in the near future, and do not release significant stimulus.

Ibrahim, a senior analyst at Harvest International Futures said, alumnium price reduction is still reasonable, considering the market behavior that is responsive to changes in commodity price information to make a little depressed. He estimated that industrial commodity prices, including aluminum will bounce back next week. Over the next week, Ibrahim predicts, strengthening limited to aluminum, in the range of U.S. $ 1,730 - U.S. $ 1,920 per metric ton.