SHANGHAI, Mar. 17 (SMM) – The market will absorb the Fed’s interest rate decision for March and Fed Chair Janet Yellen’s statement today. Base metals are expected to climb today but will continue to diverge.
The Fed left interest rate unchanged in March. It acknowledged US economic activities have been expanding mildly, and property market improved further, with inflation rate also higher, but also pointed out global economy and financial markets are still facing risk. Interest rate hikes are reduced from 4 to 2 times this year. This pushed down the US dollar index and boosted crude oil and base metals.
But Fed Chairwomen Janet Yellen’s statement suggests the likelihood of an interest rate hike in April still exists.
The number of initial jobless claims in the US last week is expected to remain low. The number released last week declined to 259,000, with the average for the past four weeks down to 267,000, much lower than the average of 278,000 for 2015. This helped encourage the market.
Should the Philadelphia Fed's manufacturing index improve or return to positive territory, US manufacturing sector is expected to turn around further.
See SMM price forecast, please click:Falling Dollar to Support Base Metal Prices, SMM Says