Cooling alumina market and rebounding US Index to weigh on aluminium price

On the macro front, market expectation for the Fed's interest rate cut eased, and the rebound in the U.S. dollar index weighed on the metal market. In the future, we still need to focus on the guidance of U.S. non-farm payrolls data and European inflation data on overseas monetary policy. Domestic stimulus policies were introduced continuously. In December, PSL mortgage supplementary loans restarted, totaling 350 billion yuan. The market expects that this PSL operation will most likely be used for three major projects. Expectations for ensuring the delivery of housing to home buyers have once again heated up, which will benefit the consumption of building extrusion. In terms of fundamentals, the domestic aluminium supply has entered a period of stable operation, with no major changes in the short term. As the traditional off-season has arrived, the industry's aluminium ingot is expected to increase. The bullish sentiment in alumina market, fuelled by oil depot explosion in Guinea and the disturbance in the alumina supply caused by the heating season, may fade for the time being. The movement of SHFE aluminium will be mainly subject to the fundamentals. The short-term aluminium supply remains stable, while the consumption is still expected to weaken. The seasonal accumulation of aluminium ingots may be approaching, which will suppress SHFE aluminium. However, the current low inventory supports aluminium prices. SMM predicts that the most-traded SHFE aluminium contracts will hardly spike, and fluctuate between 19,020-19,860 yuan/mt this week. LME aluminium may move between $2,250-2,400/mt. In the future, market players should keep a close eye on domestic supply and demand and macro sentiment.