The US dollar index climbed as high as 82.71 due to the worsening debt issue in Greece and other smaller European countries, weighing down base metal prices. In view of current high inventory levels in China, base metal prices will not find much support from market fundamentals in the short term. CBI believes base metal prices will continue to fluctuate for the foreseeable future.
Copper: The ongoing debt crisis in Europe weighed down copper prices. China's strong copper imports created market concerns over existing high inventories in bonded areas. (Page 3)
Aluminum: On Tuesday, LME aluminum prices reported their largest single day decline since 2005, but later rebounded over the next two days. The linkage between aluminum prices and crude oil prices strengthened as aluminum prices fell toward the production cost range, with energy costs re-emerging as a pivotal factor. (Page 5)
Zinc: LME zinc prices fell at slower pace compared with other base metals. (Page 7)
Lead: On Tuesday, LME lead prices fell almost 3% to USD 2,240/mt, later moving around at the 30-day moving average. Transactions in domestic lead markets were made between RMB 15,600-15,850/mt, with cautious trading sentiment reported. (Page 10)
Nickel: Prices for (2.0%-2.2%) nickel ore continued to advance. (Page 13)