SHANGHAI, Mar 28 (SMM) - It was reported yesterday that the US government was considering providing additional liquidity to ease banking crisis, especially to help the First Republic Bank strengthen its balance sheet. The flow of deposits from regional banks to large banks was also said to slow down sharply. The market sentiment is thus improved, and traders are pricing in around a 55% chance of the Fed standing pat on interest rates in its next meeting in May. The First Citizens Bank bought Silicon Valley Bank, and the Vice Chairman of the Federal Reserve Financial Supervision claimed that the US banking system was stable, saying that the failure of SVB was just a result of awful management.
Overnight, LME zinc touched a low of $2,862/mt and then rallied to close at $2,911/mt, up $17.5/mt or 0.6%. LME zinc inventory remained unchanged at 39,650 mt.
SHFE zinc slipped slightly after opening in overnight trading but then kept rising and settled at 22,670 yuan/mt, up 125 yuan/mt or 0.55%. So far, the fundamentals of domestic zinc are stable. SHFE zinc prices have great potential to increase with the support of low inventory. Market players are suggested to wait and see before the risk aversion is completely digested.
