Global Metal Prices Plunge Amid Rising Inflation Concerns
Metal prices have taken a hit across the board, with base metals like copper and zinc leading the declines. According to SMM's midday commentary, SHFE copper fell by 1.52%, while SHFE zinc dropped by 1.78%. Lithium carbonate also saw significant losses, plummeting over 2% in value.
The price slump is a result of various factors, including the PBOC's reverse repo operations and the US Fed's expected interest rate hike. The US dollar index rose by 0.12%, further solidifying market expectations that rates will increase to combat inflation. This has led to concerns about commodity prices and export demand.
In other news, the Reserve Bank of New Zealand unanimously decided to raise the official cash rate (OCR) by 25 basis points to 2.75%. The Bank of Japan Governor Kazuo Ueda also hinted at a potential rate hike in September, citing price rise risks as a key factor in their decision-making process.