SHANGHAI, Oct. 25 (SMM) - Base metals posted sharp gains October 25. SHFE aluminum, lead and zinc rose by daily limit. SHFE copper also jumped. What are driving macroeconomic factors to these sharp price gains?
On the macroeconomic front, Chinese yuan’s rapid devaluation, upbeat economic indicators and other commodity markets are all attributable to rising base metals, SMM explains.
SMM Exclusive: What’s Factor Behind Big Rise in China Base Metal Market on Tuesday?
Chinese yuan weakened to nearly 6.8 October 25 after the currency was included in special drawing rights (SDR) October 1. Market players still expect further devaluation in the yuan.
Manufacturing data from China, US and Europe were upbeat recently, which helped improve market sentiment, SMM added.
An analyst from Barclays Capital said in a report positive situation in 10 fields of China and low copper inventories mean steady demand.
Meanwhile, iron ore and coal markets soared, also supporting base metals.
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