
The US dollar edged lower last Friday, as US economic data confirmed the likelihood of a July interest rate cut. Base metals ended mostly lower. LME aluminium fell 0.25% and SHFE aluminium fell 0.25%.
Three-month LME aluminium failed to stand firm at a high of US$1,812.5 per tonne and lost all the gains at closing, ending 0.14% lower at US$1,794 per tonne on Friday night. LME cash contract also followed the decline. The aluminium contract is likely to trade at US$1,790-1,850 per tonne today.
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As on June 28, Friday, LME aluminium cash (bid) price stood at US$ 1773 per tonne, LME official settlement price stands at US$ 1773.50 per tonne; 3-months bid price stands at US$ 1793 per tonne, 3-months offer price is US$ 1793.50 per tonne; Dec 20 bid price stands at US$ 1908 per tonne, and Dec 20 offer price stands at US$ 1913 per tonne.
The LME aluminium opening stock dropped below the one million mark to 996725 tonnes on Friday. Live Warrants totalled at 642500 tonnes, and Cancelled Warrants were 354225 tonnes.
LME aluminium 3-months Asian Reference Price is hovering at US$ 1796 per tonne.
SME and SHFE Aluminium Price Trend
The benchmark aluminium price on Shanghai Metal Exchange (SME) increased to US$ 2022 per tonne today from US$ 2015 per tonne on Thursday.
The SHFE August contract extended overnight declines to an intraday low of RMB 13,780 tonne before it recovered some ground to finish the trading day 0.5% lower at RMB 13,830 per tonne on Friday. The SHFE August contract fell for the fourth consecutive day as it ended 0.25% lower at RMB 13,795 per tonne last Friday night, below all moving averages. Despite falling inventories, SHFE aluminium is unlikely to strongly break the RMB 14,000 per tonne level in the short term. A cease-fire in the US-China trade war is expected to rally prices today; with the contract at RMB 13,800-14,000 per tonne and spot offers are likely at a discount of RMB10 per tonne to a premium of RMB 20 per tonne.
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