[Al] CBI Morning Review - 2009/6/11 Aluminum Market

SHANGHAI, June 11 (CBI China) -- The U.S. Treasury Department announced on Wednesday that the US budget deficit in May was USD 189.65 billion, the eight consecutive months. The US dollar became stronger after weakened first. In the morning, sources report that Russia will likely transform its foreign exchange reserves from US treasury bonds to the bonds issued by the International Monetary Fund (IMF), leading to weaker US dollar. However, the yield of US 10-year treasury bonds was higher than the yield of German government bonds, which caused US dollar asset to be more attractive, and the US dollar index rose to 80 again.

    Overnight LME base metal prices fluctuated in the high level. LME aluminum closed at USD 1,640/mt, down USD 21/mt. The inventories declined by 3,225mt to 4,274,550mt. Although stronger US dollar dampened metal prices, the strong crude oil price helped support metal prices. LME aluminum faced corrections, and the weak market fundamentals hampered aluminum price. However, aluminum price will remain high until the delivery date.

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