Overnight, the most-traded SHFE 2404 aluminum contract opened at 18,800 yuan/mt, with high and low at 18,850 yuan/mt and 18,765 yuan/mt before closing at 18,785 yuan/mt, down 10 yuan/mt or 0.05%. LME aluminium opened at $2,182/mt on Monday, with its high and low at $2,195/mt and $2,175/mt respectively before closing at $2,182/mt, down $2/mt or 0.09%.
Summary: From a macro perspective, we need to focus on the US core PCE index this week. Inflation data may provide more information on when the Fed will start cutting interest rates. In terms of fundamentals, the strike in Guinea had limited impact on bauxite; the domestic aluminium smelters maintained stable operations. On the demand, aluminium downstream companies are steadily resuming production. With the end of rain and snow and the arrival of the peak season, short-term consumption is expected to continue to improve. Low inventory and weak inventory growth will also somehow support aluminium prices. However, the aluminium ingots supply increased, which coupled with recent opening of import window may inhibit the upward room of aluminium prices. Overall, aluminium prices continue to fluctuate, and we need to pay attention to the impact of the strike in Guinea bauxite, the recovery of consumption, and the inventory decline of aluminium ingot and aluminium billets.
