Key Macroeconomic Indicators for Base Metal Prices (2015-7-15)

SHANGHAI, Jul. 15 (SMM) – The market lacked solid macroeconomic news overnight. It was reported Iran and six world powers have concluded an agreement that will lift sanctions on Tehran but place strict limits on its nuclear programme. However, crude oil prices unexpectedly rose. Negative news is believed to have been absorbed, and Iran will not contribute to crude oil sales in 12 months.

US retail sales in June fell 0.3% MoM, their largest decline since February. The drop in retail sales, part of which is included in GDP, triggered market expectations that the Fed will not hike interest rate this year. Many institutions lowered their forecasts for US Q2 growth, pushing down the US dollar index.

The People’s Bank of China held a regular meeting for Q2 recently at which it eliminated description as to effects from international commodity price volatility. Meanwhile, it decided to maintain pro-growth stance. New RMB loans in June were RMB 1.28 trillion, and M2 supply balance was RMB 133.34 trillion, both exceeding market expectations. The PBOC implemented RMB 20 billion in reverse repurchasing yesterday at a rate flat at 2.5%. It was also reported the Ministry of Finance is considering setting the third batch of local government debt replacement sums at RMB 1 trillion.

The US dollar index fell 0.17%; prices for the most actively traded NYMEX crude oil contracts increased 2.48%. LME base metals prices rose across the board.