FX.co ★ Steel Rises to 1-Month High

Steel rebar futures in China reached CNY 3,095 per tonne, marking the highest level in a month after hovering near seven-month lows of CNY 3,020 since the end of April, influenced by expectations of reduced supply. Leading steel manufacturers, including Baosteel—the world's largest—have indicated that Beijing is likely to enforce a nationwide reduction in steel output to address issues of overcapacity and dwindling demand. Although the government has not yet detailed the extent of these cuts, reports suggest that supply might decrease by 50 million tonnes this year. This development follows the National Bureau of Statistics' PMI report, which unexpectedly showed a decline in Chinese manufacturing in April as escalating tariffs between Beijing and Washington led export orders to hit their lowest point in over two years. The weak consumer signals further amplify concerns that property prices may continue to decline, putting sustained financial strain on developers burdened with debt. This situation risks their potential liquidation, subsequently eroding a significant source of global rebar demand.