1. Metals Outlook
  2. Daily Base Metals Report

US stocks started March with marginal moves after a robust February. Investors are still focussed on the central bank moves in the coming months, and the Fed’s speakers are likely to guide the macroeconomic momentum in the near term. In the meantime, US consumer confidence edged lower in February for the first time in three months as expectations about the economy deteriorated. Likewise, factory activity shrunk last month as orders, production, and employment contracted. Recent data across the board prompted investors to discount some of the possible rate cuts that were expected at the start of this year. However, a survey of economists suggested that the ECB cutting rates later than expected would be more damaging than doing it prematurely. Hence, we expect the start of the cutting cycle to take place in Q2 2024, as policymakers undo the harm that might have been caused by the hiking cycle.

Metals trading was mostly rangebound this week, as macroeconomic releases had little impact on pricing. Instead, prices continue to be technically driven, with some downward pressures felt by the dollar. We believe that markets are cautious to push the narrative out of the current ranges. However, a move outside these levels can exacerbate price moves as investors benefit from the volatility. As a result, today’s moves have been marginal. Aluminium and copper held their nerve at $2,245/t and $8,503.50/t. Lead continued to soften, erasing some of the gains made in the last couple of weeks of February. Likewise, nickel breached the $17,500/t level earlier in the day; however, it struggled to hold these levels and returned to $17,662/t.

Oil futures rallied today on continued signs of a tighter physical market, as OPEC+ members are to discuss the possibility of additional supply cuts earlier this month. WTI and Brent are now trading at November highs of $80/bl and $83/bl, respectively. Gold rallied after the markets digested the inflation news, keeping interest rate cuts on the table, prompting gold to jump above $2,050/oz; silver traded at $22.96/oz.

Lme Metals Price And Volume 01032024

All price data is from 01.03.2024 as of 17:30


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