US stocks declined yesterday ahead of the Fed’s decision, even as investors believe that the rates will be unchanged at near zero rates. US housings starts dropped in February by more than forecast as severe weather conditions impeded activity. The 10yr yield rose to a 1-year high of 1.6621% and the dollar strengthened against most major peers. Meanwhile, the EU threatened to withhold vaccine exports to the UK, as the bloc struggles to quicken the pace of its own vaccination programme. The BoE’s decision is due today and is expected to leave monetary policy unchanged.
LME metal prices were on the front foot today, apart from nickel and lead, which closed lower on the day at $16,071/t and $1,920.50/t respectively. Aluminium prices were well supported and tested resistance at $2,250/t and closed lower at $2,227.50/t. Copper was well bid in the second half of the day, testing the resistance level of $9,090/t, before closing below at $9,065.50/t; the cash to 3-month spread tightened up to $5.25/t. SHFE copper prices also gained footing, closing at CNY66,590/mt. Zinc prices remained supported above $2,810/t before closing at $2,827/t. Iron ore was range-bound but closed lower on the day at CNY1,063/mt.
Oil futures retreated as crude oil reserves reached up above 0.5b barrels. WTI and Brent fell to $63.67/bl and $67.16/bl. Precious metals were mixed once again, with gold seen lower at $1,728.30/oz, whilst silver edged up to $26.01/oz.
All price data is from 17.03.2021 as of 17:30