Market Players are Suggested to Wait and See the Fed Meeting to be Held this Week

SHANGHAI, Jul 25 (SMM) - In terms of LME zinc, as the economic readings were resilient in the United States and the Federal Reserve showed a relatively mild attitude towards interest rate hikes, the market sentiment turned positive and the metal prices bottomed out. The US stocks also enjoyed a rare increase. At the same time, the US president Joe Biden and Russian president Vladimir Putin successively visited Saudi Arabia and other countries in the Middle East for dialogue on issues like the prices of crude oil. It seemed that the crude oil prices would not fall quickly in the short term as the United States had expected. The attention shall be paid to whether the OPEC+ meeting to be held on August 3 would agree on increasing the production of crude oil. The high crude oil prices and the record-high CPI in the United States will promote the Fed to reduce market liquidity further. A 75 basis point rate hike and the predictable hawkish speech are expected to have an impact on asset prices. Fundamentally, as the prices of natural gas and electricity in Europe rose sharply, the overseas smelters were still under pressure and the output is expected to remain low. It remains to be seen whether the start of the interest rate hike cycle in Europe will deal a further blow to consumption. On the whole, before the Fed raises interest rates, the market players are suggested to wait and see. LME zinc prices are expected to fluctuate around $3,340-3100/mt this week.