SMM Nickle Market Morning Comment (Jan 23)

Overnight, the most-traded SHFE nickel contract opened at 127,750 yuan/mt, and closed at 125,940 yuan/mt, down 2,010 yuan/mt. Trading volume rose 3,326 lots, and open interest decreased by 385 lots. On the macro front, given the US CPI data on Jan 11, the core CPI has declined, boosting commodities. In addition, the inflation indicator will be released this week, cooling down the traders' expectations for an interest rate cut in March. Moreover, the news of the suspension of intermediate products projects drove SHFE nickel prices upward. From a fundamental perspective, LME inventory destocked slightly by 84 mt yesterday, with Baltimore being the main driver. Nickel price is expected to move sideways at lows.