Key Macroeconomic Indicators for Base Metal Prices (2017-5-12)

SHANGHAI, May 12 (SMM) – Attention should be on US’s April monthly retail sales, April annual CPI and The University of Michigan consumer confidence index in May, eurozone’s March industrial production after seasonally adjustment and Germany’s fresh reading of Q1 2017 GDP on Friday. Base metals were volatile and mixed on Thursday’s night trading, and c

US’s IPI and PPI both registered higher-than-expected growth in April on an annual basis, leading to anticipation of positive inflation data in US. US’s CPI will rise in April before seasonally adjustment, and there is a small possibility for the data to drop. As US’s retail sales have declined for three months in a row, market participants expect the data to rally sharply in April. If the data advances as expected, it will strengthen possibility on US’s rate hike in June’s meeting. Market participants forecast US Federal Reserve to raise rate in June and September’s meeting, and to cut balance sheet from December.

SMM Price Outlook for Base Metals on SHFE (May 12, 2017)

Germany’s unemployment has continued falling for 4 years in April, with higher-than-expected decline, a sign of strong economic growth in Germany. Hence, market participants expect Germany’s GDP growth to rise significantly in Q1 2017.

Federal Reserve Bank of Chicago Chair will give a speech on Friday night. Many Fed officials delivered hawkish comment recently, a clue for June’s rate hike and balance sheet cut at year-end.