
The US dollar index fell to 96.11 on Friday on lower demand for the safe-haven greenback, as traders hoped the upcoming trade talks between the US and China would ease tension. LME aluminium fell to a low of US$2,018.5 per tonne before it regained some losses and closed at US$2,032 per tonne on Friday night. The day's trading closed at US$ 1999 per tonne. As the dollar fell, LME aluminium is likely to rebound and trade at US$2,030-2,060 per tonne today.

As on August 17, LME aluminium cash (bid) price stands at US$ 1998per tonne, LME official settlement price stands at US$ 1999 per tonne; 3-months bid price stands at US$ 2025 per tonne, 3-months offer price is US$ 2026 per tonne; Dec 19 bid price stands at US$ 2073 per tonne, and Dec 19 offer price stands at US$ 2078 per tonne.
The LME aluminium opening stock dropped to 1120250 tonnes. Live Warrants totalled at 837325 tonnes, and Cancelled Warrants were 282925 tonne.
LME aluminium 3-months Asian Reference Price is hovering at US$ 2027 per tonne.
SME and SHFE Aluminium Price Trend
The benchmark aluminium price on Shanghai Metal Exchange increased to US$ 2087per tonne on August 20, from US$ 2086 per tonne on August 17.
Amid continued macroeconomic uncertainty, the SHFE 1810 contract failed to stand firm at highs after testing pressure above several times. While it jumped to a high of RMB 14,525 per tonne in the morning, declining longs dragged it down sharply in Friday afternoon to a low of RMB 14,385 per tonne. The RMB 14,400 per tonne level provided some support. The SHFE 1810 contract declined to a low of 14,370 per tonne and settled at RMB 14,405 per tonne on Friday night. It traded rangebound as longs and shorts added their positions. We expect the SHFE 1810 contract to trade at RMB 14,350-14,500 per tonne today with spot discounts at RMB 70-30 per tonne.
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