Zinc Prices to Remain Rangebound amid Uncertain Consumption Recovery

SHANGHAI, Feb 8 (SMM) - Yesterday, China's president Xi Jinping delivered an important speech at the opening ceremony of a seminar on studying and implementing the spirit of the party, emphasizing the need to understand and promote modernisation of Chinese characteristics. Premier Li Keqiang stressed the importance of innovating policy implementation and focusing on the needs of market players. Powell's said in his first speech after the release of employment report that a further rate hike was necessary on strong employment rate, though the inflation began to cool. The FOMC warned that the data of US non-farm payrolls indicates that the interest rates still needed to be raised.

Yesterday, LME zinc rose after opening, and then dropped slightly before advancing again. It finally closed at $3196.5/mt, an increase of $75.5/mt. LME zinc inventory shed by 625 mt to 15,600 mt.

Overnight, SHFE zinc climbed and neared the middle of the Bollinger Bands, settling at 23,600 yuan/mt, up 235 yuan/mt, or 1.01%. On the macro front, the zinc prices rallied after the US dollar index slowed down in growth and the market sentiment was digested. Before the consumption recovery shows a clear sign, zinc prices may still remain rangebound.