The US Fed Held Interest Rates Unchanged, and the Price Center of SHFE and LME Continued to Decline This Week [SMM Market Review - Weekly Price Commentary]

LME zinc: At the beginning of the week, the market adopted strong wait-and-see sentiment amid geopolitical disruptions, and LME zinc maintained a fluctuating trend; subsequently, from the fundamentals perspective, inventories outside China accumulated sharply, coupled with the escalation of the Middle East conflict, and expectations for US Fed interest rate cuts cooled significantly, putting LME zinc under pressure and driving it lower; amid wait-and-see sentiment and ahead of the US Fed rate decision, LME zinc maintained sideways movement; the US Fed then announced that it would keep rates unchanged, while US February PPI came in stronger than expected, sending LME zinc further lower; the US dollar index then pulled back, temporarily supporting LME zinc to maintain a fluctuating trend; as the market gradually digested earlier bearish factors, together with a rebound in US equities, LME zinc moved higher amid fluctuations. As of 15:00 this Friday, LME zinc stood at $3,082.5/mt, down $211/mt, or 6.41%.

SHFE zinc: At the beginning of the week, according to SMM data, China zinc social inventory continued to rise to above 270,000 mt, and heavy inventory pressure dragged SHFE zinc lower; subsequently, China consumption gradually recovered, coupled with disruptions from the Middle East situation, and market wait-and-see sentiment intensified, with SHFE zinc maintaining a fluctuating trend; afterward, inventories outside China increased sharply, and the US Fed kept rates unchanged at its policy meeting, while SHFE zinc continued to decline, dragged down by weakness in LME zinc; as zinc prices moved lower, spot zinc transactions in China improved markedly, social inventory destocked, and with the market gradually digesting bearish news, SHFE zinc rebounded slightly. As of 15:00 this Friday, SHFE zinc stood at 22,935 yuan/mt, down 1,250 yuan/mt, or 5.17%.