US CPI rebounded slightly in June, metals generally fell, LME zinc fell more than 1%, and COMEX silver fell nearly 2% [overnight market]

SMM Jul 16:

Metal market:

Overnight, base metals in the domestic market showed mixed performance, with SHFE tin up 0.1%, SHFE copper up 0.18%, SHFE nickel up 1.34%, SHFE lead down 0.44%, SHFE aluminum flat at 20,390 yuan/mt, and SHFE zinc down 0.45%. Additionally, the most-traded alumina futures contract fell 0.54%, while the continuous casting aluminum contract rose 0.1%.

Overnight, ferrous metals series mostly fell, with iron ore up 0.33%, stainless steel up 0.04%, rebar down 0.45%, and HRC down 0.46%. For coking coal and coke, coking coal dropped 0.55% and coke declined 0.79%.

Overnight, LME base metals generally fell, with LME copper up 0.4%, LME aluminum down 0.35%, LME lead down 0.1%, LME zinc down 1.04%, LME tin down 0.82%, and LME nickel up 1%.

Overnight, COMEX gold fell 0.85% and COMEX silver dropped 1.95%. SHFE gold decreased 0.42% and SHFE silver declined 0.26%.

As of 07:18 on Jul 16, overnight closing quotes

》Click to view SMM futures data dashboard

Macro front

Domestically:

[Xi Jinping: Unswervingly Advance High-Level Opening Up]The 14th issue of Qiushi Journal published on Jul 16 will carry an important article by Xi Jinping, General Secretary of the CPC Central Committee, Chinese President, and Chairman of the Central Military Commission, titled "Unswervingly Advance High-Level Opening Up." This article is an excerpt of Xi's relevant important statements from December 2012 to April 2025. It emphasizes that openness brings progress while seclusion leads to backwardness. China's development cannot be achieved without the world, and global prosperity also needs China. Continuously expanding opening up and elevating its level, using openness to promote reform and development, has been a crucial magic weapon for China's successive achievements. China's door to openness will not close, but will only open wider. The article points out the need to continuously expand high-level opening up. China's past economic development was achieved under open conditions, and its future high-quality development must also be realized in a more open environment. China should leverage its domestic mega-cycle to attract global resource factors, enhancing the synergistic effects between domestic and international markets and resources. It should steadily expand institutional opening in rules, regulations, management, and standards, proactively align with high-standard international economic and trade rules, deepen reforms in foreign trade, foreign investment, and outbound investment management systems, and create a first-class market-oriented, law-based, and internationalized business environment. The strategy of upgrading pilot free trade zones should be implemented, encouraging pioneering and integrated exploration to build new highlands of reform and opening up with higher levels and stronger radiating effects. Improve mechanisms for high-quality Belt and Road Initiative cooperation. Greater openness necessitates stronger emphasis on security, better coordination between development and security, and enhanced capabilities in competitiveness, open market supervision, and risk prevention. We must advance high-standard opening-up under the rule of law and continuously strengthen the legal foundations for such openness. (CCTV News) [Click for details]

[Announcement]CAILINGSHE, July 15 - The State Council Information Office will hold a press conference titled "Achieving High-Quality Implementation of the 14th Five-Year Plan" at 10:00 AM on Friday, July 18, 2025. Commerce Minister Wang Wentao will introduce achievements in high-quality commercial development during the 14th Five-Year Plan period and answer questions from journalists.

[Announcement]The State Council Information Office will hold another press conference at 3:00 PM on Friday, July 18, 2025, inviting Xie Shaofeng, Chief Engineer of the Ministry of Industry and Information Technology, to discuss industrial and technological development in H1 2025 and take media questions.

[PBOC Conducts 1,400 Billion Yuan Buyout Reverse Repo Operations for Second Consecutive Month]To maintain ample liquidity in the banking system, the People's Bank of China (PBOC) conducted 1,400 billion yuan ($190.3 billion) in buyout reverse repo operations on July 15, marking the second consecutive monthly increase. According to the announcement, the PBOC utilized fixed-quantity, rate-based tenders with multiple winning bids, allocating 800 billion yuan for the 3-month (91-day) tenor and 600 billion yuan for the 6-month (182-day) tenor. With 1,200 billion yuan in buyout reverse repos maturing in July, this operation resulted in a net injection of 200 billion yuan. In June, the PBOC conducted two such operations, also achieving a 200 billion yuan net injection, and maintained the expansionary approach in July.

US Dollar Update:

The US dollar index rose 0.53% to 98.63 overnight. US consumer price growth hit a five-month high in June, with rising costs for certain goods indicating tariff impacts on inflation, potentially keeping the US Fed on hold through September. The Bureau of Labor Statistics reported Tuesday that June's Consumer Price Index (CPI) increased 0.3% MoM - the largest gain since January and matching consensus forecasts - following a 0.1% rise in May. The June data reflected higher rental costs and a 1.0% rebound in gasoline prices after four consecutive monthly declines. Year-over-year, CPI accelerated to 2.7% in June from 2.4% in May, slightly exceeding economists' projections of 2.6% growth. US President Trump's tariff policies are seen as exacerbating price pressures and prompting the US Fed to keep interest rates unchanged while observing their impact. Fed Chairman Powell said he expects prices to rise this summer. Despite an increase in the Consumer Price Index (CPI), core inflation remained mild last month. US federal funds rate traders currently expect a 44 basis point interest rate cut by the end of this year, a slight decrease from the 48 basis point cut expected before the data release, with the first cut still expected to occur in September. Additionally, according to CCTV News, on the 15th local time, US President Trump posted on his social media platform "Truth Social" that inflation is low and the Fed should cut interest rates by 3 percentage points, which could save $1 trillion in a year. The market is currently awaiting Wednesday's US Producer Price Index (PPI) data for more information. (Wenhua Comprehensive)

》US June CPI data released: Inflation indicators heat up but don't scare the market

Data:

Today will see the release of the UK's June CPI year-on-year rate, the UK's June core CPI year-on-year rate, the UK's June retail price index year-on-year rate, China's June total electricity consumption - monthly (unscheduled from the 16th to the 20th), the Eurozone's May seasonally adjusted trade balance, the US's June PPI year-on-year rate, the US's June core PPI year-on-year rate, the US's June industrial production month-on-month rate, the US's June capacity utilization rate, the US's June manufacturing production month-on-month rate, the US's June manufacturing capacity utilization rate, and the US's June industrial production year-on-year rate - seasonally adjusted, among other data.

Additionally, attention should be paid to speeches by Fed Governor Barr at a conference hosted by the Fed; 2025 FOMC voter and Boston Fed President Collins; Bank of England Governor Bailey; 2026 FOMC voter and Dallas Fed President Logan speaking on the US economy; 2026 FOMC voter and Cleveland Fed President Hamrick; Fed Governor Barr speaking on financial regulation at the Brookings Institution; and Nvidia CEO Jensen Huang holding a media briefing in Beijing.

Crude oil:

Both WTI and Brent crude oil futures fell overnight, with WTI down 0.34% and Brent down 0.51%. This follows US President Trump's demand for Russia to end the Ukraine conflict within 50 days to avoid sanctions, easing market concerns about any immediate supply disruptions.

According to Russian media reports, the Secretary General of the Organization of the Petroleum Exporting Countries (OPEC) said that oil demand will remain "very strong" in the third quarter, thus maintaining market balance in the short term. OPEC's monthly report stated that despite trade conflicts, the global economy may perform better than expected in the second half of this year, with refineries maintaining high crude oil intake to meet increased summer travel, which helps support the demand outlook. Following a downward revision in its forecast in April, OPEC maintained its global oil demand growth forecast for 2025 and 2026 unchanged in its monthly report released on Tuesday, citing a strong economic outlook. "So far, India, China, and Brazil have performed better than expected, while the US and the Eurozone are experiencing a sustained rebound since last year," OPEC said in the report.

Data released by the American Petroleum Institute (API) showed that US crude oil, distillate, and gasoline inventories all increased last week. As of the week ending July 11, crude oil inventories rose by 839,000 barrels. Gasoline inventories increased by 1.93 million barrels, and distillate inventories rose by 828,000 barrels. Surveys had projected a decline of about 600,000 barrels in US crude oil inventories, an increase of about 200,000 barrels in distillate inventories, and a decrease of 1 million barrels in gasoline inventories for the week. The US Energy Information Administration (EIA) will release its weekly inventory report at 22:30 Beijing time on Wednesday. (Wenhua Comprehensive)