SMM Aluminum Morning Meeting: Lower Inflation Data Boosts LME Aluminum Rebound

[SMM Aluminum Morning Meeting Summary: US Fed Inflation Data Lower-Than-Expected, US Dollar Index Weakens, LME Aluminum Bottoms Out and Rebounds]

Macro front, the US PCE and core PCE indices were both lower than expected, indicating a slowdown in inflation. The market has increased bets on an interest rate cut in March next year. The US dollar index pulled back from a two-year high, providing a boost to base metals.

Fundamentals side, the pressure on the domestic aluminum supply side has eased recently. On one hand, domestic aluminum operating capacity has slightly decreased, with reports of capacity technological transformation or production cuts due to losses at some aluminum smelters in Sichuan and Guangxi. On the other hand, affected by coal supply guarantees in Xinjiang, the in-transit volume of domestic aluminum ingots has declined, leading to an accelerated drop in inventory.