Macro: (1) The US Fed maintained the benchmark interest rate unchanged at 4.25 per cent- 4.50 per cent, the fourth time it has kept rates steady since January. The Fed's dot plot indicates that it expects to cut interest rates twice in 2025 and 25 basis points each in 2026 and 2027. (Bearish ★)
(2) The Bank of England is set to announce its interest rate decision on Thursday, with expectations that it will keep rates unchanged at 4.25 per cent, while hinting at a strategy of cutting rates once every other meeting. (Bearish ★)
Fundamentals: (1) According to SMM statistics, on June 18, aluminium ingot inventory in Guangdong was 160,500 tonnes; in Wuxi, it was 114,000 tonnes; and in Gongyi, it was 51,000 tonne, totalling 325,500 tonnes across the three locations, a decrease of 6,000 tonnes from the previous trading day. On June 18, regarding the inventory of aluminium billet in two domestic locations, Guangdong had 56,800 tonnes and Wuxi had 19,800 tonnes, totalling 76,600 tonnes, a MoM decrease of 1,400 tonnes. (Bullish ★)
(2) According to SMM, small and medium-sized aluminium wire and cable enterprises in Hebei reported being in a semi-shutdown state, with the industry's operating rate weakening and market consumption momentum insufficient. This weak performance is mainly attributed to two factors: First, the State Grid has just gone through a concentrated delivery cycle, and although enterprises have sufficient orders on hand, new orders have not yet been matched in a timely manner.
Second, the current spot aluminium prices are at a high level, while the bid prices of enterprises in the early stage are significantly lower than the current prices, severely compressing profit margins. As a result, enterprises have low willingness to purchase raw materials and lack the motivation to produce finished product inventories. (Bearish ★)
Primary Aluminium Market: On Wednesday, the SHFE aluminium futures market fluctuated upward in the morning session, with a significant upward trend. However, the actual transaction premiums in the spot market narrowed. Due to the arrival of the traditional off-season, downstream enterprises were hesitant to purchase at high prices, and trading activity was far from ideal.
