FX.co ★ Iron Ore Extends Rebound

Iron ore futures in China have risen to CNY 725 per tonne, marking a recovery from the six-month low of CNY 685 experienced on April 8th. This increase comes amid hopes for economic stimulus measures from Beijing and a potential de-escalation in the US-China trade conflict, alleviating worries of weak demand for ferrous metals. US President Trump indicated a possible reduction in tariffs on China, offering some relief from the ongoing trade tensions. Furthermore, Beijing has expressed its intention to bolster the economy, especially given the pressure faced by industries reliant on US markets, heightening expectations for an accelerated release of stimulus measures. This follows a significant upsurge in bond sales reflected in the latest credit data, which has bolstered projections for construction activity and improved financial conditions for debt-laden property developers, principal consumers of ferrous metals in China. Also reducing trade war pessimism, China's official construction Purchasing Managers' Index (PMI) climbed to a 10-month high in March.