Price Performance Indicators

Focus:

1. In the week (18/9-22/9) ICDX tin prices weakened by 3.21%.
2. The Fed maintains benchmark interest rates

Market Review

ICDX tin price movements experienced a decline of 3.21% in a week to level 26,560 which was influenced by market concerns following the Fed's decision to keep interest rates unchanged. The US Federal Reserve kept interest rates unchanged on Thursday (21/09) , but tightened the monetary policy stance hawkish with a projected further increase in interest rates at the end of this year, which could hamper the pace of economic growth and demand for Tin. Apart from that, it is also feared that the Fed's stance to maintain its interest rate policy unchanged will be followed by other central banks. Meanwhile, China on Wednesday vowed to speed up the implementation of more policies to consolidate its economic recovery, state media CCTV quoted on Wednesday as saying (20/09), citing a cabinet meeting chaired by Premier Li Qiang, after the economy showed signs of temporary stabilization. This news reduced market concerns about the economic situation in the world's largest tin importer. Furthermore, PBoC on Wednesday (20/09) decided to keep its benchmark interest rate unchanged as recent signs showed economic stabilization and a weakening yuan. The one-year loan interest rate (LPR) remains at 3.45% and the five-year LPR also remains at 4.20%.

From an optimistic perspective,The release of data from the National Bureau of Statistics (NBS), showed China's industrial output grew 4.5% in August, higher than expectations at 3.9%, and higher than July's growth of 3.7%. Retail sales also grew faster at 4.6% in August compared with a 2.5% increase in July, and a forecast increase of 3%. The release of China's latest economic data shows signs of stabilization with industrial output and retail sales growing faster than expectations while also indicating that the recent economic stimulus relief measures implemented by the Chinese government are slowly succeeding in stabilizing the stalled economic recovery.

Market View

Luck Lead In the middle There is Issue The Fed's Continued Interest Rate Hikes

The core US personal consumption expenditures (PCE) price index, excluding food and energy costs, rose 3.9% year-on-year in August after increasing 4.3% in July while recording the first sub-4.0% increase since June 2021. Overall, however, US PCE in annualized terms increased 3.5% from the previous month's 3.4% increase. US PCE is the inflation measuring data that the Fed likes as a basis for determining monetary policy. The Fed's meeting a few weeks ago resulted in US interest rate policy remaining in the range of 5.25% - 5.50% with most market players predicting further interest rate increases until the end of this year. Minneapolis Fed President Neel Kashkari revealed he was one of those on the hawkish adding that if the economy is fundamentally stronger, then interest rates need to be slightly higher which is then maintained for a longer period.

Meanwhile, factory activity in China expanded more slowly in September, a private sector survey showed on Sunday, with sluggish external demand weighing on the outlook even as output rose. The global PMI index (PMI) released by Caixin/S&P fell to 50.6 in September from 5100 in the previous month, missing analyst estimates of 51.2. The 50-point index mark separates growth from contraction.

WEEKLY ECONOMIC DATA & EVENTS CALENDAR

Source: ICDX Research