Copper inventory replenishment, focusing on the Fed’s acceleration of taper’s impact on gold prices
Copper: the copper price adjusted slightly this week, the recent economic turn signals were frequent, the demand side was expected to improve, and although the inventory rebounded sharply, it was in a low position. As of December 15, 2021, Shanghai copper reported 68000 yuan / ton, with a weekly change of – 2.26%, and the inventory reported 9531 tons, with a weekly change of 51.33%.
Aluminum: the supply and demand of aluminum is weak, and the price rises slightly. Although the profit of electrolytic aluminum industry has improved recently, it is still low. The operating capacity maintained a downward trend and imports continued to close. Affected by the economic work conference, the demand side is expected to improve and the inventory continues to be replenished. As of December 15, 2021, Shanghai aluminum reported 18960 yuan / ton, with a weekly change of 0.48%, and the inventory reported 242374 tons, with a weekly change of 6.87%.
Precious metals: the Federal Reserve accelerates the taper, and the gold price may be under pressure in the short term. The CPI of the United States reached 6.8% in November, and the core CPI also rose to 4.9%, continuing to reach a new high. Although the market had full expectations in the early stage, the wording on inflation was revised in the policy statement according to the Federal Reserve interest rate meeting held on December 15, us time. The statement deleted the sentence that the current high inflation is mainly a “temporary factor”, and changed the statement in the last resolution from “the supply-demand imbalance related to the epidemic and the economic resumption of work have contributed to the sharp rise in prices in some industries” to “the supply-demand imbalance related to the epidemic and the economic resumption of work have continued to contribute to the high level of inflation.” In view of the high inflation level, the Federal Reserve chose to accelerate the reduction of the scale of bond purchase and increase the monthly scale of asset purchase from $15 billion to $30 billion from January next year, That is to reduce the monthly purchase of US $20 billion of US Treasury bonds and US $10 billion of institutional mortgage-backed securities (MBS). In addition, the Federal Reserve has also released a signal to accelerate the pace of raising interest rates. The dot matrix shows that two-thirds of officials expect to raise interest rates three times in 2022 and 60% expect to raise interest rates three more times in 2023. After the meeting, Powell said that he would not start raising interest rates before completing the debt reduction, and has not made a decision on the time interval between completing the debt reduction and starting the interest rate increase. Despite the disturbance factors of Omicron virus, however At this stage, inflation may be the focus of more attention of the Federal Reserve, and the gold price may be under pressure in the short term. As of December 15, 2021, spot gold in London closed at US $1776.9/oz, with a weekly change of – 0.25%; The US dollar index was 96.56, with a weekly change of 0.27%; The US real interest rate recorded – 0.93%, with a weekly change of 6BP.
Rare earth permanent magnet: the price of rare earth oxide fluctuated this week and remained relatively high as a whole. As of December 15, 2021, praseodymium oxide (lowest price) closed at 873000 yuan / ton, unchanged during the week; neodymium oxide (lowest price) closed at 883000 yuan / ton, with a weekly change of 2.20%; praseodymium neodymium oxide (lowest price) closed at 843000 yuan / ton, with a weekly change of – 0.59%; dysprosium oxide (lowest price) closed at 2915 yuan / kg, unchanged during the week; terbium oxide (lowest price) closed at 11200 yuan / kg, unchanged during the week.
Risk tip: the global economic recovery is less than expected; US inflation remains high; The production and sales of new energy vehicles are lower than expected; The energy crisis eased more than expected; The demand for magnetic materials is less than expected; Rapid recovery of supply in Myanmar; Power rationing less than expected
