Kung Hei Fat Choy, and our best wishes for a healthy and happy Chinese New Year, being the year of the Monkey. As the 2017 Chinese New Year falls on January 28, it’s not quite a full year, but let’s not confuse things. It is said People born in the Year of the Monkey are characterised as lively, quick-witted, curious, innovative and mischievous, but it is also believed to be one of the most unlucky years in the Chinese calendar, a fact probably not lost on the Chinese fire department as the local residents have been letting off homemade fireworks.
On the LME markets, it has been a quiet week and with China and much of Asia on Lunar holidays, it is expected to remain so.
The AUD/USD is currently trading at 70.87 having traded above 72c briefly late last week.
DJ Most Base Metals Gain on Weaker Dollar, Chinese Lunar New Year
By Carolyn Cui and Ese Erheriene
Base metals took a breather on Monday, with prices for tin, lead and zinc all gapping higher on a day when the dollar was weakening and global equity markets were bleeding, and China, the biggest consumer of many such metals, was out to celebrate its Lunar New Year.
At the London Metal Exchanges, Copper was the only laggard among all the industrial metals, down 0.6% at the Commodity Exchange division of the New York Mercantile Exchange.
“The weaker dollar has helped most commodities stabilize over the last few days,” said Edward Meir, an independent consultant to INTL FCStone Financial Inc.
More news of production cuts over the past few days also helped underpin the price gains in base metals. But there is lingering concern that the cuts announced so far will be insufficient to clear the supply glut in certain markets, such as nickel.
“There’s loads of nickel around, there haven’t been sufficient cuts, there hasn’t been any major restocking from stainless steel consumers, so it’s looking quite horrible,” said David Wilson, director of metals research and strategy at Citigroup Inc.
Looking ahead, markets are expected to be tense as China-based traders are away from their desks for Lunar New Year holidays. China is the world’s biggest consumer of many base metals, accounting for roughly 45% of global copper demand and more than 50% of global nickel demand.
“Markets will remain quiet but susceptible to volatility with much of Asia out for Lunar New Year holiday,” said ANZ Research in a note.