SHANGHAI, Dec. 22 (SMM) -- Fitch Ratings said on December 21st that it may lower Greece's credit rating to below investment grade, and Moody's Investors Service also put Portugal's credit rankings on review for a possible downgrade. The mounting European debt woes weighed down the euro, and the US dollar index advanced further in response, with the index hit a high of 80.822 before falling slightly at the tail of trading. Recently, the negative correlation between the US dollar index and base metals showed signs of weakening. China's import and export data released yesterday improved investor optimism toward future demand for base metals, and Chilean copper mine Dona Ines de Collahuasi declared a force majeure suspension on its copper concentrate sales contracts, also generating market concerns over copper supply shortages.
On Tuesday, LME aluminum prices opened at USD 2,392/mt, and later climbed steadily to break the USD 2,400/mt mark, and finally closed at USD 2,435/mt, up USD 57/mt compared with the previous trading day. LME aluminum inventories fell further by 3,325 mt to 4,279,575 mt. Today, SHFE aluminum prices opened significantly higher, with SHF 1103 aluminum contract prices even breaking through RMB 16,700/mt. However, SHFE aluminum prices mainly depend on other base metal price trends due to limited inflows of speculative funds on SHFE aluminum market, and SMM predicts SHFE 1103 aluminum contract prices will move between RMB 16,650-16,800/mt today.
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