[SMM Nickel Midday Review] Nickel Prices Rise Slightly on September 8 as US Non-Farm Payrolls Data Disappoints, Strengthening Interest Rate Cut Expectations

SMM Nickel Market Update on September 8:

Macro News:

(1) August nonfarm payrolls unexpectedly cooled, increasing by only 22,000. June employment data was revised downward to negative growth, marking the first monthly employment contraction since 2020. The unemployment rate rose to its highest level since 2021. Interest rate swaps indicate traders now price in a 96% probability of a 25-basis-point US Fed rate cut at the September meeting, with expectations for a potential 50-basis-point reduction this month.

(2) SAFE statistics show China's foreign exchange reserves stood at $3,322.2 billion as of end-August 2025, up $29.9 billion (0.91%) from July. The stable and progressive Chinese economy has demonstrated strong resilience and vitality, supporting the basically stable foreign reserve level.

Spot Market:

Today's SMM #1 refined nickel prices ranged 121,300-123,700 yuan/mt, averaging 122,500 yuan/mt, up 800 yuan/mt from the previous session. Jinchuan #1 refined nickel spot premiums quoted between 2,100-2,200 yuan/mt, averaging 2,150 yuan/mt (up 100 yuan/mt). Domestic mainstream electrodeposited nickel spot premiums/discounts fluctuated between -100-200 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2510) fluctuated at highs during the night session before closing marginally higher at 121,350 yuan/mt (+250 yuan/mt, 0.21%). Morning trading saw rangebound movement, with the contract settling at 121,560 yuan/mt (+0.38%) by midday.

US August nonfarm payrolls added merely 22,000 (vs. 75,000 expected), with unemployment rising to 4.3%. Sharply heightened Fed rate cut expectations and liquidity easing prospects supported base metal prices including nickel. However, persistent LME nickel inventory growth to 215,418 mt fundamentally capped rebound potential. Short-term nickel prices may rebound moderately with limited upside, with SHFE nickel's reference range at 121,000-125,000 yuan/mt. Market focus remains on upcoming US CPI data this week - further inflation pullback could reinforce rate cut expectations and boost nickel prices.