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Daily Base Metals Report

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US markets were led higher today by tech stocks as investors await the earning’s season data. US PPI jumped by 11.2% y/y in March, the highest level since 2010, exceeding all estimates, underscoring the persistence of consumer prices coming from the producer side in the coming months. Despite the brief relief from the CPI figures yesterday, today’s producer price release is reinforcing the expectations of a 50bps rate hike from the Fed in May. The dollar and the 10yr US Treasury yield both declined. Likewise, in the UK, inflation surged to a 30-year high of 7.0% in March, with BOE seeing inflation hitting 8.0% in the coming months.

A mixed day on the LME exchange, only with copper and aluminium to trade lower during the day. Zinc advanced for the fourth straight day as it tested the psychological resistance level of $4,500/t before closing marginally lower at $4,461.50/t. Nickel saw another day of declines, closing at $32,981/t; meanwhile, volumes have increased for the first time in four days. Aluminium settled marginally lower at $3,236/t. Lead closed higher on the day at $2,432.50/t. Treasury Secretary Yellen warned China of potential economic consequences given its relationship with Russia. In the meantime, Russia has stated that it will find other trade partners for its energy exports as traditional customers are seen rejecting new contracts.

Oil futures edged higher following IEA’s report that lowered its demand outlook given the lockdown in China but also stated that OPEC+ producers will struggle to increase the supply. WTI and Brent trade at $102.89/bl and $107.40/bl. Precious metals were all on the front foot, with gold and silver gaining ground into $1,981/oz and 25.79/oz, respectively.

For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.

All price data is from 13.04.2022 as of 17:30

Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

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