
The dollar index on Wednesday extended its gains to 98.189; its highest since May 2017, as a surprise drop in German business morale weighed on the euro. With a strong US dollar, LME base metals traded mixed on Wednesday and aluminium fell 0.2%. SHFE aluminium rose 0.6%.
Three-month LME aluminium hovered in a wide range and ended 0.24% lower at US$1,871.5 per tonne on Wednesday. LME aluminium remained above the five- and 10-day moving averages. With a robust SHFE counterpart, LME aluminium is expected to rise to a range of US$1,860-1,890 per tonne today.
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As on April 24, LME aluminium cash (bid) price stood at US$ 1853 per tonne, LME official settlement price stands at US$ 1854 per tonne; 3-months bid price stands at US$ 1871.50 per tonne, 3-months offer price is US$ 1872 per tonne; Dec 20 bid price stands at US$ 1998 per tonne, and Dec 20 offer price stands at US$ 2003 per tonne.
The LME aluminium opening stock stood at 1032925 tonnes. Live Warrants totalled at 647250 tonnes, and Cancelled Warrants were 385675 tonnes.
LME aluminium 3-months Asian Reference Price is hovering at US$ 1873 per tonne.
SME and SHFE Aluminium Price Trend
The benchmark aluminium price on Shanghai Metal Exchange dropped to US$ 2113 per tonne today from US$ 2116 per tonne on April 23.
A lack of confidence across longs saw the most-active SHFE 1906 contract decline after it rose fast to an intraday high of RMB14,195 per tonne after opening yesterday. It traded rangebound and closed at RMB14,140 per tonne. Expectations of a supply surplus for the third quarter grew shorts across the SHFE August, September, and October contracts. We see limited downside room in the June contract. The most traded June contract extended its recent gains to end at RMB 14,240 per tonne overnight, up 0.6% over the session. Despite a sharp increase in the greenback, SHFE aluminium rose overnight. It is expected to trade between RMB 14,150-14,250 per tonne today with spot discount of up to RMB 30 per tonne.
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