Metals News
Macro Roundup (Jan 20)
data analysis
Jan 20,2020

SHANGHAI, Jan 20 (SMM) – This is a roundup of global macroeconomic news last weekend and what is expected in the day ahead.

Last weekend

The US dollar rose a four-week high against a basket its rivals on Friday, as strong US economic data reduced fears about an impending slowdown. US homebuilding surged to a 13-year high in December as activity increased across the board, suggesting the housing market recovery was back on track amid low mortgage rates. That came after data on Thursday showed that US retail sales increased for a third straight month in December, while a gauge of manufacturing activity in the US Mid-Atlantic region rebounded in January to its highest level in eight months.  

LME base metals closed mixed on Friday. Zinc jumped 1.3%, nickel rose 1% and tin advanced 0.8%, while copper stayed flat. Aluminium shed 0.2% and lead dipped 0.1%.

The SHFE complex also saw mixed performance on Friday night. Nickel dropped 1.2%, copper fell 0.6%, aluminium lost 0.3% and lead edged down less than 0.1%, while tin and zinc rose more than 0.1%.

China said Friday its economy grew by 6.1% in 2019, its slowest in 29 years but meeting analyst expectations even amid the protracted trade war with the US, which reached a truce last week after Washington and Beijing signed an initial “phase one” trade deal. In Q4 2019, China’s gross domestic product (GDP) grew 6% year on year, unchanged from the growth pace in Q3, according to the National Bureau of Statistics (NBS).

NBS data on Friday also showed that industrial output in China rose 6.9% from a year earlier in December, the strongest growth in nine months and above an expected 5.9%, while retail sales climbed 8%. Fixed-asset investment rose 5.4% for the full year, but growth had plumbed record lows in the autumn.

Eurozone inflation picked up slightly in December, with headline inflation coming in at 1.3% from 1% in November, showed data released on Friday. Although well below the European Central Bank’s 2% target, the marginal upward momentum may decrease the possibility of further monetary policy easing from the central bank in the immediate future.

Back in the US, manufacturing output rose unexpectedly in December as a drop in motor vehicle output was outpaced by increases in production of other durable goods, food and beverages, and other products. The Federal Reserve said on Friday that manufacturing production rose 0.2% last month after a downwardly revised 1% increase in November. Overall industrial output fell 0.3% in December after a downwardly revised increase of 0.8% in November.

US job openings fell in November to the lowest level in almost two years, indicating more employers see headcounts sufficient enough to meet demand. The number of positions waiting to be filled decreased by 561,000 to 6.8 million, the lowest since February 2018, according to the Labor Department’s Job Openings and Labor Turnover Survey, or JOLTS, released Friday.

The University of Michigan said the preliminary reading of its US consumer sentiment index in January was 99.1, down slightly from 99.3 in the prior month.

US energy firms added 14 oil rigs in the week to January 17, bringing the total count to 673, energy services firm Baker Hughes Co said in its closely followed report on Friday.

Day ahead

The Chinese central bank is set to announce the monthly fixing of the country’s benchmark lending rate today.

US stock and bond markets will be closed Monday in observance of the Martin Luther King Jr. holiday.

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