SHANGHAI, Feb. 25 (SMM) – The European Commission predicted last Friday that the euro zone’s economy will shrink 0.3% in 2013, down from its earlier forecast. The ongoing general election in Italy will add uncertainties to the European economy. As a result, the US dollar rose against the euro, causing LME aluminum prices to extend losses for a fifth straight day. Finally, LME aluminum closed at USD 2,047.3/mt, losing 5.37% in the week, and further declines are expected. Latest LME aluminum inventories increased 6,175 mt to 5,164,200 mt.
Aluminum prices will drop further today. LME aluminum should struggle at USD 2,050/m and fluctuate in the band of USD 2,030-2,070/mt on Monday. SHFE 1305 aluminum contract is expected to open lower at RMB 14,920/mt, with prices between RMB 14,880-14,980/mt. In spot markets, supplies will be ample, but downstream consumption will remain sluggish, with spot discounts expected between RMB 130-170/mt.