Steel prices have been auctioning below $100.00 for the past three weeks as market veterans are trimming steel demand forecast due to China's lack of construction activities. As individuals are dodging mortgages to the banking sector, critical for real estate and construction activities, steel demand is fading dramatically.
Steel mill owners are banking on production cuts as steel stockpiles are accelerating faster due to weak demand in China. Major Angang Steel Co., near Beijing, cited that “it sees tough conditions persisting through the end of the year”.
The Chinese authorities are aware that the overall demand is dropping vigorously, which forced the People's Bank of China (PBOC) to adopt a ‘dovish’ stance on the Prime Lending Rate (PLR). It is worth noting that the PBOC trimmed its one-year PLR and five-year PLR by five and 15 basis points (bps) respectively. Also, economic stimulus is around the corner to spurt economic activities and eventually the growth rate.
US employment data falls short of expectations, aluminium ingot continues destocking trend this week
