Aluminium falls to 2-month low on Iran peace hopes, stronger dollar
RING•Aluminium fell to its lowest in more than two months, touching $3,136 a metric ton, as hopes for Middle East diplomacy, a stronger dollar and a more optimistic supply outlook weighed on prices.
1. Prices hit a low
Benchmark three-month aluminium on the London Metal Exchange was down 0.79% at $3,144.50 a metric ton by 0700 GMT after touching $3,136, its lowest since July 28.
2. Diplomacy and supply
The market assessed US-Iran peace talks after Tehran said it had received a US response to its latest proposal to revive the collapsed Gulf ceasefire. Any easing of disruption to shipping through the Strait of Hormuz could improve aluminium flows from Gulf producers to international markets, BNP Paribas metals strategist David Wilson said.
3. Dollar and demand pressures
The dollar hovered near a two-month high as Treasury yields rose, reflecting investor concerns about inflation and government debt. AL Circle research head Rupankar RM said rising Chinese aluminium exports were increasing international availability while domestic demand remained relatively subdued; expectations of smelter restarts and additional capacity were also making the supply outlook more comfortable.
