Singapore iron ore futures fell on Friday and were forecast for weekly losses, with renewed optimism about China’s rapidly fading economic stimulus and market attention returning to COVID restrictions -19 in the world’s largest steel producer.
The August iron ore contract on the Singapore Stock Exchange was down 1% at $112.45 a tonne, as of 0714 GMT, and is expected to post its fourth weekly loss in five weeks.
On China’s Dalian Commodity Exchange, the most-traded September contract for the steel ingredient ended the day’s trade up 0.7% at 755.50 yuan a tonne, from the day’s high of 782. yuan.
In the spot market, iron ore prices were also set for weekly declines, with the 62% benchmark material bound for China priced by consultancy SteelHome at $114 a tonne on Thursday, in down 3% from last week.
China’s finance ministry was planning to allow local governments to sell 1.5 trillion yuan ($220 billion) of special bonds in the second half of this year to boost infrastructure financing to support the national economy. struggling, Bloomberg News reported.
Sources had told Reuters in an exclusive July 5 report that China would issue an advance quota for 2023 for local government special bonds later this year, with the new quota likely to exceed 1.46 trillion yuan for 2022.
China has begun to recover from the fallout from recent shutdowns, but Premier Li Keqiang was quoted by state media as saying on Thursday that more effort is needed as headwinds to growth persist.
“A recovery in property sales and construction is unlikely to be meaningful as long as lockdowns and restrictions remain a real risk,” said Vivek Dhar, commodities analyst at Commonwealth Bank of Australia.
Structural steel rebar on the Shanghai Futures Exchange SRBcv1 slid 0.8%, while hot-rolled coil SHHCcv1 lost 0.4%. Stainless steel SHSScv1 climbed 2.1%.
Dalian coking coal DJMcv1 fell 3.6%, while coke DCJcv1 fell 2.4%.
Source: Reuters (Reporting by Enrico Dela Cruz in Manila and Sonali Paul in Melbourne; Editing by Amy Caren Daniel and Rashmi Aich)