US Fed Not in a Hurry to Further Cut Interest Rates; Spot Market Transactions Slightly Increased [SMM Tin Morning Brief]

SMM Tin Morning Brief on February 20, 2025: The US Fed meeting minutes revealed that the Fed wants to see "further progress on inflation" before deciding on another interest rate cut. The Fed kept rates steady in the 4.25%-4.5% range at the last meeting, citing rising inflation pressure, and the market expects no rate cut in the March meeting either. According to the minutes, the committee unanimously agreed that "the Fed has ample time to assess the evolving outlook for economic activity, the labour market, and inflation." Many economists and market strategists are concerned that tariffs and stricter immigration policies could exacerbate inflation pressure, potentially offsetting the positive effects of tax cuts and deregulation. The Fed has previously indicated that it is not in a hurry to cut interest rates further due to persistently high inflation. Inflation has fallen back from highs seen after the pandemic but remains stubbornly above the Fed's desired level. For instance, the Consumer Price Index in January was up 3% YoY, marking the fastest pace in seven months and exceeding the Fed's 2% target. In the futures market, SHFE tin prices at the night session rebounded slightly after a sharp decline, adjusting to around 260,500 yuan/mt before the close. Overall open interest in SHFE tin contracts decreased. In the spot market, stimulated by the price drop during the night session, some downstream enterprises conducted small-scale restocking, while others only made just-in-time procurement. Overall market trading volume increased slightly compared to the previous two days, but as prices rebounded, the overall growth in trading volume was limited. If SHFE tin prices remain above 260,000 yuan/mt, the spot market may continue to see a subdued situation.