China to Halt Sulfuric Acid Exports in May, Affecting Metals and Fertilizer Sectors Amid Iran War Disruptions

[Solid Geopolitical Support, Aluminum Prices Fluctuate at Highs] Overall, from a macro perspective, restricted strait transit and risks of conflict escalation resonated with fundamental supply-side hard damage and low global inventory, jointly providing strong bottom support for aluminum prices. However, weak interest rate cut expectations, above-expectation aluminum ingot inventory buildup in China, and adverse expectations on consumption and inflation driven by recent high fluctuations in oil prices all notably weighed on the upside room for aluminum prices. In the short term, aluminum prices are expected to fluctuate at highs.

Amid the current turmoil in the Middle East and soaring energy prices, US consumer confidence deteriorated significantly. The preliminary reading of the University of Michigan Consumer Sentiment Index for April came in at 47.6, a sharp decline from 53.3 in March, hitting a record low. Meanwhile, the preliminary 1-year inflation expectations reached 4.8%, surging 1 percentage point from March, marking the largest increase in nearly a year.

Driven by a sharp surge in energy prices, the US Consumer Price Index (CPI) for March showed significant growth. CPI rose 3.3% YoY, marking the highest reading since June 2024. On a MoM basis, CPI increased 0.9% in March, the largest gain since July 2022. Focusing further on energy prices, energy prices surged 10.9% MoM in March, the largest single-month increase since September 2005. Among energy price components, gasoline prices stood out in particular, rising 21.2%, the largest monthly gain since 1967, and the increase in gasoline prices accounted for nearly three-quarters of the month's CPI gain.