SHANGHAI, Jun 20 (SMM) –While the Fed paused June rate hikes, it released "hawkish" signals. Domestic financing and new loans rose MoM, but the growth fell below predictions, amplifying expectations for stimulus policies. Domestically, short-term pressure on aluminium smelting supply is minimal. Due to Yunnan's struggle to boost capacity and a high molten aluminium output, low aluminium ingot stocks may hold in the short term, supporting SHFE front-month aluminium contract prices. As we near long contract settlement dates and anticipate stock replenishment before the Dragon Boat Festival, the spot aluminium market will remain active, maintaining a premium. In the medium to long term, however, weakening consumption due to growing supplies may challenge aluminium prices. SMM forecasts the most-traded SHFE 2307 aluminium contract to fluctuate between 18,100-19,000 yuan/mt and LME aluminium $2,200-2,320/mt. Keep an eye on Yunnan's resumption news and spot market trading sentiment.
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