US Dollar Index Falls to Yearly Low, Overnight Aluminum Futures Rise [SMM Aluminum Morning Meeting Summary]

SMM, Aug 28: Overnight, the most-traded SHFE aluminum 2410 contract opened at 19,950 yuan/mt, reaching a high of 20,035 yuan/mt and a low of 19,915 yuan/mt, closing at 19,995 yuan/mt, up 95 yuan/mt or 0.48% from the previous close. On Tuesday, LME aluminum opened at $2,532/mt, with a high of $2,554/mt and a low of $2,502.5/mt, closing at $2,546.5/mt, up $13/mt or 0.51%.

Summary: On the macro front, driven by the upcoming interest rate cut expectations, the US dollar fell by 3.2% in August. The market is currently awaiting inflation data, which may provide clues for the US Fed's rate cut next month. On the fundamental side, recent power rationing and other disruptions have not had a substantial impact on aluminum production, keeping the supply side relatively stable. Currently, the aluminum market is experiencing a decline in purchasing power and ample circulation of aluminum ingots, which suppresses the narrowing of spot discounts. However, with the traditional peak season and domestic economic stimulus policy, consumption is gradually recovering, and the inventory reduction turning point is expected. In the short term, aluminum prices are expected to remain in a strong fluctuation, with continued attention needed on macro changes and the sustainability of downstream aluminum consumption.