US PPI boosts interest rate cut expectations, LME zinc may continue to rise [SMM zinc morning comment]

Published: Apr 12, 2024 10:00

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Overnight, LME zinc opened at US$2,750.5/ton. After a brief decline at the beginning of the session, it quickly rose, reaching a high of US$2,788/ton, finally closing at US$2,767/ton, an increase of US$16/ton, or 0.58%. The trading volume decreased to 16,082 lots, and open interest increased by 1,990 lots to 250,000 lots. LME zinc inventory has not changed. As US PPI data has boosted expectations for rate cuts, LME zinc may have further upside room.
The most active SHFE 2406 zinc contract fell to a low of 22540 yuan/mt after opening at 22800 yuan/mt, and finally closed at 22715 yuan/mt, down 155 yuan/mt or 0.68%. Trading volume was down to 130,000 lots, and open interest grew by 1962 lots to 125,000 lots. Affected by the expected improvement in future downstream demand, the macro sentiment was relatively positive. However, zinc prices were too high and downstream purchases were poor, and inventories increased again, suppressing the upward momentum of SHFE zinc.

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