Overnight, LME zinc opened at $2392/mt, hitting a low and high of $2376/mt and $2421/mt respectively, and closed at $2417/mt, up $27.5/mt or 1.15%. Trading volume decreased to 9134 lots, and open interest grew 2162 lots to 202,000 lots. LME zinc inventory decreased by 450 mt or 0.21% to 215000 mt. Data from the New York Fed showed that U.S. consumers' median expectations for inflation over the next year fell for the second consecutive month in November, falling to 3.4% from 3.6% in October, the lowest level since April 2021, strengthening expectations of an end to rate hike by the Federal Reserve.
The most-traded SHFE 2401 zinc contract opened at 20600 yuan/mt overnight and fell to 20510 yuan/mt before rallying to a peak of 20780 yuan/mt. It eventually settled at 20735 yuan/mt, up 130 yuan/mt or 0.63%. Trading volume reduced to 33862 lots, and open interest gained by 75 lots to 83688 lots. According to SMM research, refined zinc production in November recorded 579,000 tons, lower than previously expected. With the supply slightly lower than expected, the fundamentals have supported zinc prices. But supply has been ample, and there is not much room for SHFE zinc to rise.
