Fed Chairman Jerome Powell Reiterates No Rush to Cut Interest Rates; SHFE Tin Prices May Hover at Highs [SMM Tin Morning Meeting Notes]

SMM Tin Morning Meeting Summary on February 24, 2025 International macro side, Fed Chairman Powell reiterated that there is no rush to cut interest rates. US Treasury yields rose, coupled with uncertainties in tariff policies, leading to a decline in market risk appetite, which exerted pressure on tin prices. The US dollar index fluctuated significantly, especially after weak US January retail sales data, pulling back to around 107, providing short-term support for the non-ferrous metals sector. However, Fed Governor Bowman emphasized that more evidence of declining inflation is needed before cutting interest rates. The market remained cautious about the March FOMC meeting, suppressing risk appetite. Domestically, the tin ore market showed a strong futures performance but relatively weak spot conditions. On the supply side, the expected resumption of Myanmar tin ore production has not yet materialized. Domestic tin ore supply remained relatively stable, but inventory pressure was significant. On the demand side, growth in the electronics and new energy sectors supported tin prices, but traditional consumption sectors were weak, with downstream enterprises resuming work at a slow pace and low market trading activity. Regarding social inventory, SMM tin ingot social inventory across three regions and SHFE tin inventory both experienced inventory buildup, while LME tin inventory continued to decline, indicating increased short-term supply pressure. Overall, SHFE tin futures prices are expected to hover at highs in the short term, with a reference range of 262,000 to 268,000 yuan/mt. Tight supply conditions and potential growth in new energy demand will continue to support tin prices, but uncertainties in macro policies and weak traditional consumption may limit upside room. Investors should closely monitor US Fed policy developments and the progress of Myanmar tin ore production resumption while being cautious of volatility risks from the spread between futures and spot prices. As the Two Sessions approach, market expectations for macro policy benefits are increasing, and attention should be paid to statements from relevant representatives. The US dollar index faced downward pressure, boosting SHFE tin prices denominated in yuan, while the strong performance of gold and other precious metals also provided linked support to the non-ferrous sector. From a technical perspective, the most-traded SHFE tin contract recently broke through the 260,000 yuan/mt level, with short-term resistance moving up to around 268,000 yuan/mt and support at 255,000 yuan/mt. In the near term, SHFE tin prices may hover at highs, with mixed bullish and bearish factors. Bullish factors include a weaker US dollar, overseas destocking expectations, tight domestic supply, and policy-driven demand stimulation. Bearish risks include slower-than-expected downstream resumption, expanded spot discounts suppressing purchase willingness, and selling pressure triggered by high prices. Investors should closely monitor US Fed policy developments and the progress of Myanmar tin ore production resumption.