Dalian iron ore slumps to late March lows on demand concerns from China

Iron ore futures in China drop over 4.0%, down for the second consecutive week.
Pollution control, covid woes weigh on the metal prices.
AUD/USD cheers USD pullback but bears remain hopeful.

Anil Panchal FXStreet

Iron ore futures on the Dalian commodity exchange drop over 4.0% on a day to $125.70 amid early Friday. In doing so, the metal adds to the 9.0% weekly south-run, not to forget mentioning the second week of fall.

Although fresh fears that the Delta covid variant challenges the global economic recovery weigh on the commodity prices in general, China’s latest pollution control measures seemed to have weighed on the iron ore prices.

“The China Iron and Steel Association said in a statement this week mills that are more polluted or consume high energy should lower steel production. It also pledged to ensure that 2021 steel output will fall on an annual basis,” said Reuters. The news also cites data from Mysteel consultancy while saying, Capacity utilization rates of blast furnaces at 247 mills across China recovered slightly to 85.89% this week but still well below 95.16% the same period a year earlier.”

It’s worth noting that iron ore is the largest export item for Australia and hence the commodity’s weakness weighs on the AUD/USD prices. However, the latest pullback of the US dollar seems to restrict the Aussie pair’s immediate moves around 0.7340.

Read: AUD/USD struggles inside a choppy range below 0.7350 amid subdued markets

It should be observed that fears of monetary policy consolidation by the People’s Bank of China and downbeat economics from the dragon nation also keep iron ore bears hopeful. Even so, the metal traders will keep their eyes on Monday’s China Industrial Production and Retail Sales figures for fresh impulse.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

EUR/USD keeps the bid bias just over 1.1800

EUR/USD has started the week on a positive foot, hovering around the 1.1800 region in the latter part of Monday’s session. The pair’s recovery comes on the back of a decent decline in the US Dollar, as investors keep their attention on the evolving US–EU trade relationship after President Trump’s announcement of sweeping global tariff hikes.

GBP/USD looks stuck around 1.3500 amid firm gains

GBP/USD is pushing further north on Monday, revisiting the 1.3500 hurdle and beyond. Cable’s uptick is largely being fuelled by the broader softness in the Greenback, amid lingering uncertainty around tariffs.

Gold pops above $5,200, four-week highs

Gold is holding onto its bullish tone on Monday, reaching new multi-week highs just past the $5,200 mark per troy ounce. Fresh trade-war concerns, coupled with rising geopolitical tensions in the Middle East, are keeping demand for the yellow metal well on the rise.

Crypto Today: Bitcoin, Ethereum, XRP intensify sell-off as tariff uncertainty weighs

Bitcoin, Ethereum and Ripple are trading amid increasing selling pressure at the time of writing on Monday, as investors react to fresh trade uncertainty over US President Donald Trump’s push for more tariffs.

Supreme Court nixes tariffs, Trump teases 15% global tariff

On February 20th, the Supreme Court ruled that Trump’s global tariffs under IEEPA authority were unconstitutional, effectively nullifying the framework. However, the relief was short-lived. Within hours, Trump floated a 15% blanket tariff under an alternative legal authority.

XRP recovers slightly as bearish sentiment dominates crypto market

Ripple is rising above $1.40 at the time of writing on Monday amid fresh tariff-triggered headwinds in the broader cryptocurrency market. The sell-off to $1.33, the token’s intraday low, can be attributed to macroeconomic uncertainty, geopolitical tensions and risk-averse sentiment among other factors.