SHANGHAI, Jul. 22 (SMM) – The US dollar index fell following Fed Chairman Bernanke’s announcement that any decision to scale back bond-buying program will depend on how labor market and economy perform, buoying commodity prices. LME aluminum held stable at USD 1,800/mt during the early European session, and later broke through resistance at the 30-day moving average due to short-covering. Finally, LME aluminum ended the day up USD 21/mt or 1.16% at USD 1,825.5/mt. Positions decreased 4,456 lots to 740,728 lots. LME aluminum inventories were down 1,825 mt to 5,477,725 mt.
A softer US dollar will lend support to aluminum prices. LME aluminum will hover near USD 1,830/mt and move within USD 1,810-1,850/mt on Monday. SHFE 1310 aluminum contract is expected to open higher at RMB 14,350/mt, with prices between RMB 14,320-14,400/mt. In spot market, trading will be light, with spot discount of RMB 0-30/mt and premium of RMB 0-10/mt expected over SHFE 1308 aluminum contract prices. HSBC will announce China’s flash manufacturing PMI for July tomorrow.