FX.co ★ Iron Ore Slips on Weak Chinese Steel Output

Iron ore futures fell below 700 CNY per tonne on Tuesday, reaching a three-week low. This decline followed data revealing a 6.9% reduction in China's steel production for May, marking the first decline since Beijing committed to tackling industry overcapacity in March. The decrease in production suggested a weaker demand for raw materials, impacting market sentiment negatively. Furthermore, investors approached the week with caution as they awaited the US Federal Reserve's policy decision, where the central bank is anticipated to keep interest rates steady. Nonetheless, the prospect of additional rate cuts has waned due to ongoing trade uncertainties and inflationary pressures propelled by increasing oil prices. Adding to the market's cautious approach were geopolitical tensions; US President Donald Trump called for a full evacuation from Tehran amidst ongoing Israeli airstrikes and prematurely departed the G7 summit in Canada to focus on the unfolding situation in the Middle East.