Zinc prices slipped below $3,800 per tonne, hitting their lowest level in nearly a month, pressured by a stronger US dollar following the Federal Reserve’s hawkish rate move. The Fed implemented its first interest-rate increase in more than three years and signaled at least one more hike before the end of the year. A firmer dollar makes dollar-denominated commodities more expensive for holders of other currencies, dampening demand.
Even so, downside pressure is capped by relatively tight supply conditions. Lower mine output and production disruptions have constrained the availability of concentrates. Smelter treatment charges have dropped sharply into negative territory, underscoring the scarcity of feedstock for refiners. At the same time, LME zinc inventories remain low by historical standards, and physical zinc availability outside China is particularly tight.
