US dollar fell on a weekly basis, most metals prices fell (fell), while silver futures on NYMEX surged over 9% on a weekly basis, and LME aluminum and alumina prices dropped over 1% [overnight market]

SMM, June 7:

Metal Market:

As of the overnight close, domestic market base metals showed mixed performance. SHFE lead led the gains with a 0.15% increase, SHFE nickel rose by 0.11%, and SHFE tin closed flat at 262,930 yuan/mt. SHFE zinc fell by 0.38%, and alumina dropped by 1.26%. Overseas market base metals collectively declined, with LME aluminum leading the losses with a 1.07% drop. LME tin fell by 0.94%, LME zinc by 0.87%, and LME copper by 0.71%, with the remaining metals experiencing minor fluctuations in their declines.

In the ferrous metals series, prices collectively fell overnight. Stainless steel dropped by 0.67%, HRC by 0.68%, rebar and iron ore by over 0.5% (rebar fell by 0.57%, iron ore by 0.56%). In the coking coal and coke sector, coking coal fell by 0.13%, and coke by 1.44%.

In the precious metals sector overnight, COMEX gold fell by 1.31% but gained 0.47% on a weekly basis. COMEX silver rose by 0.91%, reaching a high of $36.51/oz during the session, a new high since 2012, and surged 9.39% on a weekly basis. SHFE gold fell by 1.09% but gained 1.42% on a weekly basis. SHFE silver rose by 0.62%, hitting a record high of 8,867 yuan/mt during the session since its listing, and gained 7.64% on a weekly basis.

Overnight closing prices as of 7:58 a.m. on June 7

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Macro Front

Domestic Developments:

On the morning of June 6, Premier Li Qiang of the State Council had a scheduled phone call with Canadian Prime Minister Justin Trudeau. Li Qiang pointed out that China-Canada development represents opportunities, not threats, for each other. There are no fundamental conflicts of interest between the two countries; instead, there is a history of traditional friendship and mutual benefit. He hoped that Canada would work with China in the same direction, view China's development objectively and rationally, achieve mutual success, and jointly promote prosperity. China is willing to work with Canada to jointly uphold multilateralism and free trade, and promote the correct development of economic globalization and the multilateral trading system, injecting more stability into world peace and development. Trudeau stated that Canada-China relations have experienced setbacks in the past few years, and Canada is willing to restart the relationship. He looks forward to resuming high-level exchanges and dialogue mechanisms with China in areas such as diplomacy, economy, and trade, and strengthening practical cooperation in trade, agriculture, energy, and environmental protection.

The China National Coal Association and the China Coal Transportation and Distribution Association are scheduled to hold the "2025 Summer National Coal Trading Conference" from July 10 to 11. The theme of the conference is "Promoting Efficient Allocation of Resource Elements and Facilitating Dynamic Balance in Coal Supply and Demand." The conference aims to earnestly implement the decisions and arrangements of the CPC Central Committee and the State Council, continuously enhance the viability, competitiveness, development capacity, and sustainability of the coal industry chain and supply chain, and maintain stable and healthy economic development and overall social stability.

The China Automobile Dealers Association and Jingzhengu jointly released the "Research Report on China's Used Car Price Retention Rate in May 2025." The report points out that the duration of the recent surge in the used car market, driven by trade-in subsidies, is difficult to predict. When considering prices, the price war for new cars in May and June continues, and price reductions may dampen the activity in the used car market.

US dollar:

The US dollar index rose 0.48% overnight to close at 99.22, while it fell 0.22% on a weekly basis. This is because data showed that US employment growth in May was better than expected, although the growth rate slowed compared to the previous month, suggesting that the US Fed may wait longer before cutting interest rates. Data from the US Department of Labor showed that employers added 139,000 jobs in May, down from 147,000 in April but exceeding the 130,000 increase forecasted in a survey of economists. Following the data release, financial markets bet that the US Fed would wait until September to cut interest rates, with a total of two rate cuts expected in 2025, reducing the likelihood of a third rate cut.

Other currencies:

The US dollar rose 0.95% against the Japanese yen to 144.87 yen and 0.26% against the Swiss franc to 0.822. After the data release, the US dollar's gains against these two safe-haven currencies widened. The US dollar rose against the yen and the Swiss franc for the second consecutive week but was still down about 8% and about 9% year-to-date, respectively.

Immediately after the employment data release, the euro fell further against the US dollar, closing down 0.43% at 1.1395 US dollars in New York. Year-to-date, the euro has still risen about 10% against the US dollar. After European Central Bank President Lagarde's comments that the ECB was approaching the end of its monetary policy easing cycle, the euro briefly touched a six-week high of 1.14950 US dollars against the US dollar on Thursday and is set to post a weekly gain.

Data:

Next week, global leading indicators for the turning point of the industrial production cycle in May will be released. In China, data such as the year-on-year PPI for May, the year-on-year CPI for May, the trade balance in yuan for May, the year-on-year import and export growth rate for May, the year-on-year M2 money supply growth rate for May, the year-to-date social financing scale for May, and the year-to-date new yuan-denominated loans for May will be released. In the US, data such as the final value of the wholesale inventory monthly growth rate for April, the 1-year inflation expectations of the New York Fed for May, the 3-year inflation expectations of the New York Fed for May, the 1-year gold price increase expectations of the New York Fed for May, the unadjusted year-on-year CPI for May, the unadjusted year-on-year core CPI for May, the unadjusted year-on-year energy CPI for May, the IPSOS Primary Consumer Sentiment Index (PCSI) for the US as of June 7, the initial jobless claims for the week ending June 7, the year-on-year PPI for May, the year-on-year core PPI for May, and the preliminary value of the University of Michigan Consumer Sentiment Index for June will be released. In Japan, data such as the revised quarter-on-quarter growth rate of seasonally adjusted real GDP for Q1, the revised annualized quarter-on-quarter growth rate of seasonally adjusted real GDP for Q1, the revised quarter-on-quarter growth rate of seasonally adjusted nominal GDP for Q1, and the BSI Large Manufacturing Confidence Index for Q2 will be released. In the UK, data such as the ILO unemployment rate for April, the average weekly earnings including bonuses for the three months to April, the month-on-month GDP growth rate for April, the month-on-month industrial output growth rate for April, the year-on-year industrial output growth rate for April, the seasonally adjusted goods trade balance for April, and the seasonally adjusted trade balance for April will be released. In the Eurozone, data such as the Sentix Investor Confidence Index for June, the seasonally adjusted trade balance for April, and the total reserve assets for May will be released. Additionally, data such as the month-on-month growth rate of manufacturing sales for April in Canada, the month-on-month growth rate of new manufacturing orders for April in Canada, the seasonally adjusted consumer confidence index for May in Switzerland, the ANZ consumer confidence index for the week ending June 8 in Australia, and the final value of the year-on-year CPI for May in Germany will also be released.

Additionally, on June 12, US President Trump will raise tariffs on imported steel from 25% to 50%. Furthermore, the US Fed released the "Quarterly Report on US Financial Accounts."

Crude oil:

Oil prices in both markets rose overnight, with US crude oil up 2.21% and posting a weekly gain of 6.55%, while Brent crude oil rose 2% and recorded a weekly increase of 6.16%, both achieving their first weekly gains in three weeks, supported by a positive US employment report and optimistic expectations for the US-China trade outlook. Analysts believe that the US employment report has appropriately increased the likelihood of an interest rate cut by the US Fed, which could stimulate economic growth and oil demand.

As news of tariff negotiations emerged, along with data showing how trade uncertainties and US tariff policies are affecting the global economy, the oil market continued to fluctuate. On Saturday, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, agreed to increase production by 411,000 barrels per day in July. This is part of a broader strategy by OPEC to regain market share. The organization rejected Saudi Arabia's proposal for a larger production increase.

HSBC said in a report, "Based on our estimates, with oil demand rising in the summer and peaking in July-August, matching the growth in OPEC supply, the market appears balanced in Q2/Q3." US energy services company Baker Hughes stated in its closely watched report that the number of oil and natural gas rigs operated by US energy firms fell for the sixth consecutive week this week, the first such six-week decline since September 2023. (Wenhua Comprehensive)