US stock and bond markets deepened their declines today as the investors price in the steepest tightening since 1994, with 250bps worth of rate hikes to take place this year. The Fed minutes pointed to a reduction in bond holdings at a maximum of $95bn/month; it has also showed that many officials were in favour of a 0.5 percentage point hike in March, suggesting that this rate of tightening might be appropriate for the upcoming meetings. The dollar softened. Elsewhere, German factory orders fell for the first time in four months in March, and many companies stated that a recession would be inevitable if Germany cut itself off from Russian oil and gas.
Another day of lacklustre moves on the LME exchange, only with nickel edging slightly higher to close at $33,467/t. Aluminium started the day on the front foot but struggled to break above resistance of $3,500/t, closing at $3,441/t. Copper was range-bound before breaking below the support of $10,350/t in the latter half of the trade to close at $10,305/t. Zinc and lead both closed lower at $4,274/t and $2,413.50/t, respectively. Iron ore futures fell for the first time in three days but struggled to break below $160/mt today; following the increasing nickel costs and now growing lockdown restriction on the manufacturing industry in China, the stainless steel mills may be forced to cut production by about 30,000t in April, according to Mysteel Global.
Oil futures declined today, with WTI falling below $100/bl, but support at $99.15/bl remains robust. Precious metals gained marginal ground, with gold and silver trading at $1,928/oz and $24.49/oz.
For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.
All price data is from 06.04.2022 as of 17:30