FX.co ★ Iron Ore Futures Rise to 6-Week High

Iron ore futures in China climbed by almost 2%, reaching CNY 732 per tonne – the highest level observed in the past six weeks. This surge was fueled by improved investor sentiment following indications of easing tensions between the United States and China. Progress in trade discussions between the two countries was announced, and statements from both governments indicated a readiness to advance, easing concerns of further economic upheaval. This newfound confidence positively impacted metals markets, including iron ore, a crucial component in steel production. Despite this, the fundamental demand dynamics remain weak: China's steel consumption is facing pressure from a cooling property sector and ongoing long-term economic transitions. Additionally, planned production cuts in the steel industry, aimed at reducing emissions, could further constrain iron ore demand. Nevertheless, expectations of government stimuli and initial signs of stabilization in the real estate market have offered some support.