Three-month LME aluminium extended growth by 0.67% on the lowest dollar index since early this year

The US dollar fell across the board after the US Federal Reserve cut interest rates on Tuesday, March 3, in an emergency move designed to shield the economy from the impact of the coronavirus.The dollar index, which tracks the greenback against a basket of other currencies, slipped to the lowest level since January 8 at 96.92.

In a statement, the US central bank said it was cutting rates by a half percentage point to a target range of 1.00% to 1.25%.

Three-month LME aluminium rose to an intraday high of US$ 1,734 per tonne and finished 0.67 per cent higher on the day at US$ 1,728 per tonne, as the surprise interest rate cut from Fed lifted market sentiment. Trading range is expected at US$ 1,705 per tonne to US$ 1,750 per tonne.

LME aluminium cash (bid) price, on Tuesday, March 3, recorded a significant hike of US$ 21.5 per tonne to stand at US$ 1705.5 per tonne. LME official settlement price also increased by the same amount and came in at US$ 1706 per tonne. 3-months bid price stood at US$ 1720 per tonne, while 3-months offer price at US$ 1722 per tonne. Dec 21 bid price hovered at US$ 1843 per tonne and Dec 21 offer price at US$ 1848 per tonne.

The LME aluminium opening stock continued to decline from 1071875 tonnes, as of March 2, to 1061375 tonnes, as of March 3. Live Warrants totalled at 791850 tonnes and Cancelled Warrants 269525 tonnes.

LME aluminium 3-months Asian Reference Price stood at US$ 1715.97 per tonne.

SHFE Aluminium Price Trend

After an increase yesterday, on March 3, benchmark aluminium price for SHFE dropped today, on March 4, by US$ 11 per tonne from US$1,899 per tonne to US$1,888 per tonne.

SHFE aluminium is expected to continue to oscillate around the five-day moving average tomorrow. The most-liquid SHFE contract is expected to be traded at RMB 13,150 per tonne to RMB 13,400 per tonne today.