SHANGHAI, Mar. 5 (SMM) -- LME nickel prices remain generally weak. The higher-than-expected financing scale of the ECB’s LTRO2 and a low likelihood of QE3 will exert downward pressure on LME nickel prices in the short term and dampen upward momentum. However, over the long term, the LRTO2 will improve liquidity in the euro zone and boost LME nickel prices. Close attention should be paid to China’s National People’s Congress and indications of domestic demand in China. SMM expects LME nickel prices will remain relatively firm and move between USD 19,000-20,200/mt if no significant negative news is announced.
In the Shanghai nickel spot market, domestic spot nickel prices are expected to remain below converted LME nickel prices and traders are having difficulties importing Russian nickel since sluggish demand is not expected to improve in the coming week. In this context, SMM expects spot nickel prices will not advance with rising LME nickel prices, but will largely move within the RMB 135,000-148,000/mt range in the coming week.