As investors considered the likely course of interest rates, zinc yesterday decreased by -0.87% to 246.15. Although a cut is now mostly anticipated by year’s end, markets are still pricing in a 25 bps increase in the fed funds rate for next month. Williams, the president of the New York Fed, recently stated that the central bank needed to maintain strict policy since inflation is still too high.
This week, several policymakers are scheduled to make appearances that will give additional cues about the direction of the policies. The U.S. economy hasn’t altered much in recent weeks, according to the most current edition of the Fed’s monthly Beige Book, and consumer spending is widely expected to be flat to declining. The output of domestic refined zinc grew as predicted in March, rising to 556,800 mt, or 55,300 mt, or 11.03% MoM, and 12.26% YoY. The alloy output totaled 82,610 mt, up 16,900 mt from the previous month.
Between January and March, the output reached 1.57 million mt, an increase of 6.62% from the previous year. Although domestic zinc smelters continued to operate at high rates in March despite the fact that the TCs for domestic zinc ore’s metal content fell to 5,100 yuan/mt in that month, due to the high profits. A further boost to expansion came in March when the Henan Jinli Zinc Smelter successfully attained its maximum capacity.
Technically, the market is in long liquidation as evidenced by the market’s drop in open interest of -8.96% to close at 2408 while prices are down 2.15 rupees. Currently, Zinc is receiving support at 244.3, and a move below that level could result in a test of the 242.5 level. Meanwhile, a move above that level could result in a test of 250.1.
