Wednesday (December 18), the U.S. dollar index narrow range shock after rebound to the upside, as of 16:35 GMT, the dollar index at 106.960 (+0.01, +0.01%); U.S. crude oil main 02 bias to the upside at 70.03 (+0.38, +0.55%).
Shanghai copper day was weak shock pattern, the main contract 2501 finally closed down 0.84%, closing price at 73,930 yuan. Market cautious atmosphere pervades, non-ferrous plate large area under pressure to fall. Currently in the copper demand off-season, the market performance tends to weaken, the spot transaction is sluggish, the copper prices to form a suppression. In addition, the hawkish tone of the Federal Reserve foreshadowed next year's path of interest rate cuts may be heavy resistance, coupled with the European and American markets before the Christmas holidays, risk appetite fell back, Shanghai copper continue to maintain the shock trend.
The Federal Reserve interest rate resolution announcement is imminent, the funds chose to hedge profit-taking away from the market, resulting in copper prices above the pressure. Although the Fed has repeatedly discussed interest rates during the year but did not cut interest rates, the stubbornness of inflation has led to the postponement of interest rate cuts, the dollar index performance is strong. Although Powell made the direction of interest rate cuts clear at the annual meeting of global central banks, in September has opened the second interest rate cut of the year, but the dollar is still strong. Especially after Trump's successful presidential victory in November, the dollar soared. In addition, in this last interest rate meeting of the year, the Fed delivered a hawkish tone, although the December rate cut is a foregone conclusion, but the rate cut in January next year may slow down, Fed officials will be more cautious in the future on the road of interest rate cuts, the interest rate cut cycle may be short-lived, the second half of the year or stop, the U.S. dollar may continue to be stronger, and the copper price constitutes a negative.
On the domestic economic front, there have been two rate cuts during the year, which are stronger than in previous years and release the possibility of further rate cut policies. Meanwhile, interest rates have been cut three times and the LPR has been adjusted to promote high-quality economic development. Fiscal policy is active, the issuance of special treasury bonds, support for localised debt, real estate market, etc. The end of September to increase the introduction of macroeconomic stimulus policies, the market atmosphere is positive, the stock market soared to drive the price of copper. in November the official release of the macro stimulus policy, increase the limit of local government debt, for five consecutive years to arrange for a special bond debt, macroeconomic environment is expected to be stable and good, the price of copper has a positive impact. In addition, the ‘trade-in’ policy has boosted consumer enthusiasm in the new energy vehicle and home appliance markets, supporting the demand outlook for the metal market and limiting the decline in copper prices.
Fundamentally, Chilean copper miner Antofagasta has agreed with China's Jiangxi Copper and other smelters on next year's benchmark treatment fee, a sharp decline in fees reflecting the tense pattern at the mining end, foreshadowing a continuation of next year's supply constraints, which will be supportive of copper prices. However, new orders in the market decreased, but most companies have enough orders in hand in advance, supporting the start rate in early December to maintain a high level. At the same time, in late December, many copper rods and downstream enterprises will carry out year-end settlement, or part of the demand released in advance to the middle and early December. But overall, the year-end atmosphere is gradually turning thick, the terminal is low to replenish the lack of kinetic energy, the transaction surface weakness is obvious, consumption is expected to add cold, copper prices are under pressure to weak shock.
Taking the current macro and micro situation into account, the macro factor is still a key factor in pricing. Although the copper market consumption retains the toughness, inventory continues to support prices. But into the second half of December, the year-end atmosphere is gradually thick, the terminal is not enough momentum to replenish low inventory, the transaction surface weakness is obvious. Copper prices are expected to be under pressure and weak shock. However, taking into account the low level of domestic social inventory and the end of the year, there is a rush order, copper prices in a short period of time below the space or can not quickly open. Therefore, in the operation should avoid chasing short, waiting for the rebound after the high short opportunity is given priority to.
Post time: Dec-19-2024