LME aluminium to remain under downward pressure

LME aluminium will fall further to USD 1,565-1,590/mt.  

SHFE 1611 aluminium should move at RMB 11,800-12,000/mt, with short selling pressure eased.

In east China’s spot aluminium market, spot premiums of RMB 110-150/mt are expected over SHFE 1609 aluminium contract.

Key macroeconomic indicators for base metal prices

US August LMCI, the US IBD consumer confidence index in September and eurozone annualized Q2 GDP are slated for release today. Base metals are expected to diverge today.

Disappointing US non-farm employment and salary figures in August bode ill for US CCI.

Market expectations of a Fed rate hike in September decreased due to weakening non-farm payrolls in the US. US non-farm employment data are expected to be revised upwardly significantly. Should the LMCI extend gains in August, the US dollar index will receive a boost.

The European Central Bank will announce its interest rate decision for September this Thursday. Eurozone annualized Q2 GDP is expected to be flat at Q1’s. But as growth will likely slow, market expectations that the ECB will hike rate increase.

National Iranian Oil Company’s official said on Monday that the country will likely raise crude oil output to 5 million barrels per day in 2-3 years, and will increase oil output to 4 million barrels per day in the near term. This should weigh on oil prices in the near term.