LME markets remain relatively steady in USD terms with LME copper currently trading within USD100/t and aluminium within USD50/t of the average of the past 30 days. This week though, it’s the Australian Dollar that’s having the biggest effect on our prices with the AUD continuing to slide, currently trading at 69.30.
Using the Hedge Settlement Rate as a guide, the AUD is down more than 4c over the past 30 days of trade, with some analysts suggesting there may be more downside to be seen.
Irrespective of LME markets, traders and manufacturers remain timid in the market with end users continuing to prefer to keep stock at low levels. Facts are, as we scope the global economy, most countries are struggling through difficult times at the moment with many Governments forced to use stimulus measures to keep things moving ahead. It seems that the old saying “it’s only the depth that varies” may be rather accurate at this time.
Please find the following for your perusal;
**** This Week in Metals: 31 August-4 September ****
- Houston, 4 September (Argus) — Global equity markets gyrated lower amid signs of slowing growth from China to Brazil and Canada, weakening factory activity in the US, and ongoing currency volatility that partly reflects concerns over the Federal Reserve’s anticipated rate increase.
- China’s factory sector shrank in August at the fastest rate in at least three years.
- China’s official manufacturing Purchasing Managers Index fell to 49.7 in August from 50 the prior month, the National Bureau of Statistics said on 1 September.
- Canada’s economy meanwhile entered a recession, as data this week showed the economy shrank by 0.5pc in the second quarter after falling by 0.8pc in the first quarter.
- In Brazil, government data showed the economy shrank by 2.6pc in the second quarter from a year earlier, putting the economy in the worst recession in two and a half decades.
- In the US, the factory sector is showing some signs of weakness even though car sales have been robust.
- Stock market volatility of late, exacerbated by China’s 11 August currency devaluation, has prompted pundits to increasingly look beyond the 16-17 September Fed meeting for the next rate hike as policy makers are seen as less likely to begin tightening during a time of global turmoil.