US April PPI Rose 6% YoY, Metals Broadly Higher, LME Aluminum and SHFE Tin Up Over 2%, SHFE Silver Up Over 3% [Overnight Market]

SMM News, May 14:

Metals market:

Overnight, domestic market base metals all rose. SHFE copper was up 0.38%. SHFE aluminum was up 1.25%, SHFE lead was up 0.42%. SHFE zinc was up 0.71%. SHFE tin was up 2.12%. SHFE nickel was up 0.88%. In addition, the most-traded alumina futures contract was up 0.43%, and the most-traded foundry aluminum futures contract was up 1.01%.

Overnight, ferrous metals mostly rose, while iron ore and rebar both edged down, with declines within 0.1%. Stainless steel was up 0.3%, and hot-rolled coil edged up. Coking coal and coke: coking coal was up 0.69%, coke was up 0.78%.

Overnight, overseas market metals saw LME base metals rise across the board. LME copper edged up 0.02%. LME aluminum was up 2.14%, LME lead was up 0.33%. LME zinc was up 0.55%. LME tin was up 2.89%. LME nickel was up 1.27%.

Overnight precious metals:COMEX gold was up 0.22%, COMEX silver was up 3%. Overnight, the most-traded SHFE gold contract was up 0.11%, and the most-traded SHFE silver contract was up 3.38%.

As of 7:08 AM on May 14, overnight closing prices:

Macro Front

China:

[SAMR: Launching Special Campaign to Remove Obstacles Hindering Unified Market and Fair Competition]It was learned today from a press conference held by the State Administration for Market Regulation (SAMR) that SAMR has deployed a special campaign to remove obstacles hindering the unified market and fair competition, running from May through December. The campaign focuses on four types of obstacles: hindering fair market entry and independent business operations, restricting free flow of goods and factors, applying different standards for domestic and foreign qualification certification, and improperly implementing credit evaluations to set hidden barriers in tender and bid processes. The campaign will further intensify enforcement, review, and inspection efforts to strictly rectify improper interference with market competition in accordance with the law. By year-end, a number of major cases will be investigated and handled, a batch of policies and measures hindering the national unified market and fair competition will be abolished or amended, a number of typical cases will be publicly exposed, and a batch of institutional mechanisms will be expedited, to make market foundational systems such as fair competition and quality standards more scientific and comprehensive, local government economic promotion activities more standardized and orderly, market regulatory enforcement more fair and impartial, and the market environment more transparent and predictable. (CCTV News)

[Hunan Introduces Policies to Support Acquisition of Existing Commercial Housing and Housing Trade-in Programs]The Hunan Provincial Department of Housing and Urban-Rural Development, together with nine departments including the Provincial Development and Reform Commission and the Provincial Department of Finance, issued the "Several Measures of Hunan Province to Further Promote Stable and Healthy Development of the Real Estate Market." This "New Xiang Ten Measures" is an optimization and upgrade based on the 2025 "Several Measures of Hunan Province to Promote Stable and Healthy Development of the Real Estate Market," focusing on the acquisition of existing commercial housing, housing trade-in programs, "quality housing" construction, the "Three Ones" housing project, and optimization of housing provident fund policies, with relevant support measures formulated. The "New Xiang Ten Measures" specify that for those purchasing newly built commercial housing within the province and applying for loans (including housing provident fund loans and commercial loans), housing unit counts shall be determined at the county/city/district (park) level; for those who already own housing in the county/city/district (park) where the intended purchase is located, one housing unit shall be deducted from the count; and the policy of a minimum 30% down payment ratio for commercial property loans shall be implemented. (Hunan Provincial Department of Housing and Urban-Rural Development)

US dollar:

Overnight, the US dollar index was up 0.19%, closing at 98.48. Data released on Wednesday showed that US April PPI surged 1.4% MoM, while the March figure was also revised up to a 0.7% increase. This was the largest increase since March 2022, with both goods and services prices rising, versus market expectations of just 0.5%, in line with the initially reported 0.5% for March. Since the beginning of this year, producer prices have continued to strengthen, partly due to rising energy costs, as Middle East conflicts disrupted shipping through the Strait of Hormuz, impacting global supply chains and causing shortages of fertilizers, aluminum, and various consumer goods. PPI rose 6.0% YoY, the largest increase since December 2022, significantly higher than March's 4.0%, partly because the low base effect from last year has gradually exited the statistical window, thereby pushing up the current YoY reading. (Jin10 Data APP) According to the CME FedWatch tool, the market has now priced in a probability of over 30% for an interest rate hike by December. Following the unexpectedly strong US April PPI data, the market believes it is now even harder for the US Fed to justify any interest rate cuts this year. The April PPI increase of 1.4% was significantly above economists' consensus expectation of 0.5%, indicating stronger-than-expected inflationary pressures and reinforcing the market's trend of repricing the interest rate path. (Jin10 Data)

US Fed's Collins said on Wednesday that she expected interest rates to remain stable for an extended period and believed that in certain scenarios, further tightening may be needed to ensure inflation returns to the 2% target. She noted that conventional monetary policy typically "looks through" sudden supply shocks, such as oil price increases. However, given that inflation has been above target for more than five consecutive years, she believed patience for tolerating price increases is declining. Collins said the current tight monetary policy "may need to be maintained for some time." She noted: "Shocks have slightly increased downside risks to economic activity, while upside risks to inflation have further increased." She also said that if inflation pulls back, the US Fed could still continue to cut interest rates later this year. Collins added, however, that if conflicts persist and drive prices further upward, "I can envision a scenario in which tightening policy is needed to ensure inflation returns to 2% sustainably and within a reasonable timeframe." (Jin10 Data)

Macro:

Data to be released today include: UK Q1 GDP annual rate preliminary reading, UK March three-month GDP monthly rate, UK March manufacturing output monthly rate, Canada March wholesale sales monthly rate, US initial jobless claims for the week ending May 9, US April retail sales monthly rate, US April import price index monthly rate, among others.

In addition, attention should also be paid to: 2026 FOMC voter and Minneapolis Fed President Kashkari participating in a discussion hosted by a local chamber of commerce; Bank of Canada releasing monetary policy meeting minutes; 2026 FOMC voter and Dallas Fed President Logan participating in a dialogue on the energy sector; 2028 FOMC voter and Kansas City Fed President Schmid delivering a speech on "Payment Innovation and Community Banking"; US President Trump making a state visit to China.

Crude oil:

Overnight, both oil futures declined, with WTI down 1.15% and Brent down 1.9%. The US-Iran situation remained stagnant, and concerns over the possibility of a US Fed rate hike put oil prices under pressure. EIA report: US petroleum products four-week average supply was 20.051 million barrels/day, up 1.08% YoY; commercial crude oil inventories excluding the Strategic Petroleum Reserve fell by 4.306 million barrels to 453 million barrels, a decline of 0.94%. In addition, Bank of Canada meeting minutes indicated that if oil prices remain elevated, interest rate hikes would be needed.

OPEC monthly report: OPEC+ April crude oil production averaged 33.19 million barrels/day, down 1.74 million barrels from March, as the Iran war prompted Middle Eastern member states to cut production. The 2026 global crude oil demand growth forecast was lowered from 1.38 million barrels/day to 1.17 million barrels/day, while the 2027 global crude oil demand growth forecast was raised from 1.34 million barrels/day to 1.54 million barrels/day. (Jin10 Data)