SHANGHAI, Jul. 31 (SMM) – On Monday, eyes should be on China’s July official manufacturing PMI, eurozone’s June unemployment data, July CPI and US’s June pending home sales. US dollar index registered a 3-week consecutive decline on July 28, and will remain weak before releasing of nonfarm payrolls. Base metals will diverge both on SHFE and LME markets this week, with nickel and lead prices remaining in upward track.

China’s official manufacturing PMI will inch down to 51.5 in July. Economic growth in China will slow down in the second half of 2017 due to rising capital cost and tightening real estate market. But, economy growth will drop marginally thanks to stable domestic demand and rising exports. This will help manufacturing sector to remain in upward track in July for 12 months in a row. Manufacturing PMI, as an important index for operating condition of manufacturing sector, makes great impact on metal prices both in China and foreign markets.

SMM Price Outlook for Base Metals on SHFE (Jul. 31, 2017)

Unemployment in eurozone will keep falling by 0.1 percentage point in July, and the data was 9.3% in May, the lowest level from March 2009. Euronzone’s inflation data will not reach its target at 2% because of weak salary growth, despite of positive labor market. Annual CPI will also drop in July.

US’s pending home sales dropped unexpectedly in May after seasonal adjustment amid insufficient houses for sale. Lawrence Yun, Chief Economist of National Association of Realtors, once indicated that home sales will not increase as house owners are reluctant to sell houses, though more of them think this is a good time to sell house than one year before, and low inventory will allow house price to keep rising. US’s pending home sales is expected to grow in May after seasonal adjustment, a sign of real estate market improvement in US.