US dollar falls, metals generally rise; LME copper and LME nickel fall over 1%, while LME zinc, alumina, and coking coal and coke rise over 1% [overnight market]

SMM July 9 News:

Metals Market:

Overnight metals prices mostly rose across domestic and overseas markets, though LME copper, LME nickel, and SHFE nickel declined - LME copper fell 1.67%, LME nickel dropped 1.07%, and SHFE nickel lost 0.78%. All other metals posted gains, with LME zinc leading the gains with a 1.29% increase, SHFE lead rising 0.93%, and other metals showing relatively small fluctuations. Alumina main contract gained 1.86%, while aluminum casting main contract rose 0.33%.

The ferrous metals series collectively rose overnight, with iron ore up 0.68% and other metals showing minor fluctuations. For coking coal and coke, coking coal rose 1.61% and coke increased 1.09%.

Precious metals: COMEX gold fell 0.95% overnight, while COMEX silver gained 0.06%. Domestically, SHFE gold declined 0.65% and SHFE silver dropped 0.1%.

As of 6:46 AM July 9 overnight closing prices

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Macro Front

Domestic Updates:

[State Council Press Office to Hold Major Briefing Today] The State Council Information Office will hold a press conference series on "High-Quality Completion of the 14th Five-Year Plan." The first briefing starts at 10:00 AM today, with NDRC Director Zheng Shanjie introducing economic and social development achievements during the 14th Five-Year Plan period and answering questions.

[Trump Announces Tariff Hikes on 14 Countries, MOFCOM Responds] Foreign Ministry spokesperson Mao Ning hosted a regular press conference. When asked about US President Trump's July 7 announcement of 25%-40% tariff hikes on imports from 14 countries including Japan and South Korea starting August 1, Mao Ning stated China's consistent position that tariff wars and trade wars have no winners, and protectionism harms all parties' interests (CCTV News).

US Dollar:

The US dollar index fell 0.05% overnight as Trump escalated trade tensions on Monday, warning 14 countries of higher tariffs. However, with the implementation delayed until August 1, countries are watching a new three-week window for potential trade policy easing. Japan and South Korea indicated on Tuesday they will seek negotiations with the US to mitigate the impact of Trump's planned tariff increases from early August. Meanwhile, markets await the US Fed's latest policy meeting minutes on Wednesday, with Fed officials scheduled to speak this week as investors seek more clues about the economic outlook and monetary policy path. Investors currently expect the US Fed to cut interest rates by 50 basis points before the end of this year, with actions expected to start in October.

Other currencies:

The yen suffered a sharp setback on Tuesday after US President Trump reiterated his plan to impose a 25% tariff on goods from Japan and South Korea, adding further uncertainty to the already volatile trade situation.

The Australian dollar surged significantly as the Reserve Bank of Australia unexpectedly kept the cash rate unchanged at 3.85%, instead of cutting interest rates as widely expected by the market.

Starting on Monday, Trump informed trading partners—ranging from major suppliers like Japan and South Korea to some relatively smaller trading partners—that the US would implement significantly higher tariffs starting from August 1. However, he later indicated a willingness to consider granting extensions if the countries concerned proposed solutions.

The yen weakened on Tuesday, with the US dollar to yen exchange rate rising by 0.38% to 146.625. Japanese Prime Minister Shigeru Ishiba stated on Tuesday that he would continue negotiations with the US to seek a mutually beneficial trade agreement.

An EU source familiar with the matter said on Monday that the EU would not receive a tariff letter and might be exempted from the US's 10% benchmark tariff rate. The euro to yen exchange rate hit a one-year high, closing up 0.58% at 171.980, reflecting the contrasting fortunes of these two trading partners. The euro to US dollar exchange rate also rose by 0.17% to $1.1729.

The Australian dollar stood out as the best performer among major currencies on Tuesday, rising by over 1% due to the Reserve Bank of Australia's unexpected decision to keep interest rates unchanged. The Australian dollar closed up 0.6% at $0.653. The market had expected the Reserve Bank of Australia to cut interest rates, but the bank stated that the committee "believes it can wait for more information" to confirm that inflation is slowing down. However, the committee noted that inflation risks are more balanced and seemed to be waiting for the Q2 price data to be released by the end of July before making a decision.

The New Zealand dollar closed down 0.03% at $0.6, and the British pound fell by 0.04% to $1.3597. (Wenhua Comprehensive)

Macro:

Today, China's June CPI year-on-year rate, China's June PPI year-on-year rate, the final value of the US May wholesale inventory month-on-month rate, the US July IPSOS Main Consumer Sentiment Index (PCSI), the ANZ Consumer Confidence Index for the week ending July 6 in Australia, and the official cash rate decision for July 9 in New Zealand will be announced.

In addition, the Reserve Bank of New Zealand will announce its interest rate decision and monetary policy assessment report, and Reserve Bank of New Zealand Governor Adrian Orr will hold a monetary policy press conference.

Crude oil:

Oil prices in both markets rose overnight, with US crude oil up 0.37% and Brent crude oil up 0.65%, driven by the US's downward revision of its oil production forecast, tensions in the Red Sea region, concerns about US tariffs on copper, and technical short covering.

Phil Flynn, an analyst at Price Futures Group, said, "The decline in (US) production outlook has driven up oil prices, and oil prices have also risen in tandem with other commodity prices amid news of copper tariffs and escalating tensions in the Red Sea." The monthly Short-Term Energy Outlook (STEO) report released by the US Energy Information Administration (EIA) shows that US oil production in 2025 will be lower than previously expected, as falling oil prices have prompted US producers to slow down production activities this year. The EIA projects that US oil production in 2025 will be 13.37 million barrels per day (bpd), down from the 13.42 million bpd forecast last month; it projects production in 2026 to be 13.37 million bpd, the same as last month's forecast.

It is projected that US crude oil production will average 13.38 million bpd in July, compared to 13.37 million bpd in June; it is projected to average 13.41 million bpd in August; the US oil demand forecast for 2025 remains unchanged at 20.4 million bpd; it is projected to be 20.4 million bpd in 2026, the same as previously forecast. The EIA projects global oil production to be 104.6 million bpd in 2025, up from the 104.4 million bpd forecast previously; it projects global oil production to be 105.7 million bpd in 2026, up from the 105.1 million bpd forecast previously. The average prices of WTI crude oil are projected to be $65.22/barrel and $54.82/barrel this year and next, respectively, while the average prices of Brent crude oil are projected to be $68.89/barrel and $58.48/barrel this year and next, respectively.

Data released by the American Petroleum Institute (API) shows that US crude oil inventories rose last week, while distillate and gasoline inventories fell. Crude oil inventories rose by 7.13 million barrels in the week ending July 4. Gasoline inventories fell by 2.18 million barrels, and distillate inventories fell by 830,000 barrels. A deep survey shows that US crude oil, distillate, and gasoline inventories are expected to decline last week. Before the release of weekly inventory data, the average forecast of nine analysts surveyed was that US crude oil inventories were expected to decline by about 2.1 million barrels in the week ending July 4. The US Energy Information Administration (EIA) will release its weekly inventory report at 22:30 Beijing time on Wednesday. (Wenhua Comprehensive)