The US Fed's stance on a rate cut in November remains uncertain; short-term aluminum prices are expected to fluctuate upward [SMM Aluminum Morning Comment]

SMM, Sep 23: Last Friday night, the most-traded SHFE aluminum 2411 contract opened at 19,980 yuan/mt, reaching a high of 20,000 yuan/mt and a low of 19,805 yuan/mt, and closed at 19,845 yuan/mt, down 225 yuan/mt, a decrease of 1.12%. On the previous trading day, LME aluminum opened at $2,536.5/mt, hit a high of $2,551/mt and a low of $2,478/mt, and closed at $2,486/mt, down $53.5/mt, a decrease of 2.11%.
On the macro front, the US Fed's stance on a rate cut in November remains uncertain, with the probabilities of a 50BP and 25BP cut being nearly equal. The market is awaiting the release of the US Fed's employment and inflation data this week. Meanwhile, the domestic LPR rate remains unchanged, slightly dampening domestic macro sentiment. On the fundamentals side, domestic aluminum market supply saw a slight increase, alumina showed upward fluctuations due to tight supply, and domestic aluminum costs remained high. Under the influence of the September-October peak season, aluminum downstream weekly operating rates remained stable, and downstream consumption showed steady improvement. However, caution is needed regarding the negative impact of overseas tax policies on domestic aluminum processing enterprises. Aluminum social inventory is still in a destocking cycle, with good supply-demand performance in September and October. Overall, given the short-term favorable macro front and stable fundamentals, the aluminum market is expected to fluctuate upward in the short term.