Overall SHFE Nickel Prices Stabilise last Week on Frequent Economic Data Release

SHANGHAI, Mar 6 (SMM) - LME zinc: LME zinc prices fell slightly early last week after a series of economic data was released. The January US PCE data rose 4.7% year-on-year, higher than the estimated 4.3% and the previous reading of 4.4%. The US core PCE in January added 0.6% from the previous month, which was the largest increase since August 2022. The above figure highlighted the markets’ expectation for a fall in inflation while a continuation of rate hikes. The US dollar index crashed affected by the unexpected plunge in the monthly rate of durable goods orders in the US. LME zinc prices grew rapidly and fluctuated at a high level amid smaller pressure. The final reading of the US Markit manufacturing PMI in February recorded 47.3, which was lower than expected; the US ISM manufacturing PMI was 47.7 in February, lower than the expected 48 and the previous reading of 47.4. As a series of lower-than-expected economic data disturbed the market, the US dollar index weakened, and LME zinc prices fluctuated upward. Afterwards, LME zinc prices dropped somewhat. The market was again worried about the rate hikes owing to the previous decline in the number of US jobless claims, the lower-than-expected fall in the initial value of the annual rate of February CPI in the eurozone and surging commodity prices. As of 15: 00 last Friday, LME zinc stood  at $3,069/mt, with a weekly increase of $102/mt or 3.44%.

SHFE zinc: Early last week, SHFE zinc fell below 23,000 yuan/mt, weighed down by LME zinc and the overseas inflation data. SHFE zinc prices once soared boosted by overseas economic data and the strong recovery of the Chinese economy. However, the growth did not last long. SHFE zinc opened low last Friday due to overseas rate hikes, but later the supporting real estate and automobile-related policies in various Chinese cities and the bullish policies which are expected to be introduced by the Two Sessions boosted the market and beefed up zinc prices. In addition, the zinc supply in Yunan experienced disturbances from power rationing. As a result, SHFE zinc rebounded slightly. As of 15: 00 last Friday March 3, SHFE zinc closed at 23,475 yuan/mt, with a weekly drop of 30 yuan/mt or 0.13%.