SHANGHAI, Oct. 13 (SMM) – LME lead started last Friday at USD 2,083/mt, and then dipped to as low as USD 2,053/mt amid concerns over the Chinese and European economies. The price of the soft metal closed down USD 15/mt at USD 2,065/mt. Trading volumes gained 725 lots to 3,900 lots, and positions added 7 lots to 124,773 lots. Meanwhile, LME lead inventories shed 250 lots to 224,950 lots.
Lead for November delivery on the Shanghai Futures Exchange, the most active contract, hovered between RMB 13,750-13,790/mt during last Friday’s night session after opening at RMB 13,780/mt. The price of the contract finished down RMB 80/mt at RMB 13,790/mt. During the night session, trading volumes totaled 980 lots, and positions expanded 146 lots to 33,124 lots.
Federal Reserve Vice Chairman Stanley Fischer said at the International Monetary Fund’s annual meeting that if foreign growth is weaker than anticipated, the consequences for the U.S. economy could lead the Fed to remove accommodation more slowly than otherwise. Fischer added that the US Federal Reserve is unlikely to raise interest rate unless the US economy makes enough progress in expansion. He indicated that the Fed’s eventual rate increase is not expected to damage the global economy.
Ma Jun, chief economist at the People’s Bank of China (PBOC), said at the IMF and World Bank fall meetings October 11 that China's economy will not suffer a hard landing as some people fear. He added that the Chinese government will not unveil aggressive stimulus measures every time when its economic growth slows down and will work to rebalance the economy. Meanwhile, some government officials held that it is realistic to lower China’s economic growth target to around 7% for 2015
The US dollar index edged up 0.33%, but the euro slid 0.49% against the greenback. Major world shares fell across the board. LME base metals, except copper and tin, closed lower.
Base metals markets are dominated by pessimism following reports that China’s GDP growth may slip around 7.3% this year and that the government is not expected to launch aggressive pro-growth measures. In addition, China’s trade data due for release on Monday are expected to be dispiriting, which should weigh down the markets.
LME lead is set to hover between USD 2,040-2,060/mt on Monday, and the most active SHFE 1411 lead contract is projected to fluctuate between RMB 13,730-13,830/mt. On China’s physical lead markets, traded prices should range between RMB 13,650-13,750/mt.