India Base Metals
All down on firm dollar, concerns over global trade wars
This story was originally published at 17:45 IST on 28 February 2025
Register to read our real-time news.Informist, Friday, Feb. 28, 2025
By Ashutosh Pati
MUMBAI – Futures contracts of all base metals traded in the red on the Multi Commodity Exchange of India, tracking a fall in contracts on the London Metal Exchange Friday because of continued strength in the dollar. Market sentiment was also hurt as US President Donald Trump said that tariffs on Mexico and Canada will come into effect from Tuesday. Trump further said that 25% reciprocal tariff will be levied on European cars and other goods.
At 1652 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was up 0.1% at 107.40. A stronger dollar makes commodities such as base metals, which are priced in the greenback, expensive for buyers holding other currencies, denting demand.
"...Trump's confirmation of tariffs beginning next week on Canada and Mexico raised concerns of a broader trade war and a negative impact on global economic growth," Daniel Hynes, senior commodity strategist at ANZ Research said in a note.
A rise in inventories of most metals at warehouses registered with the Shanghai Futures Exchange also weighed on prices. ALUMINIUM inventories rose 1,628 tonnes on week to 234,531 tonnes and COPPER inventories increased 8,246 tonnes to 268,337 tonnes in the week ended Friday. LEAD stocks rose by 10,637 tonnes to 59,176 tonnes, however, ZINC inventories fell 5,874 tonnes to 79,391 tonnes.
For further cues, market participants will look at the US personal consumption expenditure data due later in the day. They will also monitor Beijing's upcoming National People's Congress meeting on Wednesday for potential stimulus measures.
At 1653 IST, on the MCX, the March futures contract of:
–Aluminium was at INR 258.05 a kg, down 0.3%
–Copper was at INR 862.70 a kg, down 0.2%
–Lead was at INR 180.85 a kg, down 0.1%
–Zinc was at INR 266.55 a kg, down 0.6%
Trading levels for the day on the MCX:
-Aluminium contract seen at INR 254.00-INR 262.30
-Copper contract seen at INR 847.00-INR 872.00
-Lead contract seen at INR 179.05-INR 182.15
-Zinc contract seen at INR 263.00-INR 271.10
End
US$1 = INR 87.50
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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