Metal Bulletin – Base metals prices on the London Metal Exchange put in a strong performance on the afternoon of Wednesday January 24, supported by the weaker dollar, to close in positive territory across the board.
The three-month nickel price ended more than 5% higher than Tuesday’s closing price after hitting its highest since June 2015. Volumes were also high today, with more than 18,000 lots traded by 17:15 London time, the highest since September 2017. The three-month nickel price rallied by $730 to end at $13,580 per tonne. Inventories dipped by 672 tonnes to 362,196 tonnes.
“The greenback has been sent tumbling in the wake of comments from US Secretary of the Treasury Mnuchin talking up a weak dollar from a trade perspective,” Ole Hansen of Saxo Bank said.
The dollar index bottomed out at 89.23 earlier today, its lowest since December 2014.
“Not helping matters either, is the increasing tilt towards protectionism that could spread globally if the US steps up its retaliatory spate of actions,” INTL FCStone analyst Edward Meir said. “For now, it seems that the commodity complex remains in a ‘buy the dip’ kind of a mode, with the weaker dollar being the key upside driver.”
Currency moves and data releases
- The dollar index was most recently at 89.34, down 0.74%.
- In data, the US flash manufacturing PMI in January came in at 55.5 the while flash services PMI undershot at 53.3. Existing home sales of 5.57 million missed the forecast of 5.72 million.