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21 SEPTEMBER 2017 AL CIRCLE

LME aluminium rises but may fall on a strong dollar; Fed rate hike forecasts weigh

EDITED BY : DIPANWITA GUPTA 2MINS READ

LME aluminium strengthened further as positions dropped sharply. The light metal contract rose to US2,164 per tonne on Wednesday, September 20, up from US$2,490 per tonne on Tuesday, September 19.  The U.S. Federation decided to keep the interest rate unchanged, but sounded hawkish on rate hike forecasts and balance sheet reduction sending U.S. dollar index to new highs. This is likely to weigh down base metal prices. Shanghai Metals Market predicts that LME aluminium which opened low on Thursday, September 21, will range at US$2,165-2,185 per tonne.

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As on September 20, LME official cash buyer aluminium price (Bid Price) stands at US$2,163.50 per tonne, cash seller & settlement aluminium price (Offer price) is US$2,164 per tonne, 3M Bid Price is US$2,190 per tonne, 3M Offer Price is US$2,191 per tonne, Dec3 Bid Price is US$2,310 per tonne, and Dec3 Offer Price is US$2,315 per tonne. LME aluminium Opening Stock stands at 1303925 tonnes, total Live Warrants is 1094600 tonnes, and Cancelled Warrant is 209325 tonnes.

SME and SHFE Aluminium Price Trend

The benchmark aluminium price at Shanghai Metal Exchange (SME) has edged higher from US$2,490 per tonne on Wednesday, September 20, to US$2,514 per tonne on Thursday, September 21.

During Wednesday’s night trading, all base metals at Shanghai Futures Exchange showed signs of gain with aluminium registering the highest rise. SHFE aluminium surged by 4 per cent to the highest since September 11, as news came out that two major Henan producers have begun winter capacity cuts in advance. SMM predicts that SHFE 1711 aluminium will drop initially due to US Fed’s hawkish rate hike statement, but will then rise in the range of RMB 16,800-17,050 per tonne on Thursday, September 21.

In east China spot aluminium market, spot discounts over SHFE 1710 aluminium are expected to range at RMB 270-230 per tonne on Thursday, SMM said.  


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EDITED BY : DIPANWITA GUPTA 2MINS READ

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