(Bloomberg) — Base metals slid as coronavirus outbreaks in China threatened to curtail the country’s economic output, hitting demand in the world’s top consumer of raw materials.
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Aluminum led declines on the London Metal Exchange, falling as much as 3% after dropping on Monday. Nickel trading on the LME will resume on Wednesday, more than a week after being suspended amid a historic short squeeze.
Cities and regions across China are imposing activity curbs, with the country reporting more than 5,000 new Covid-19 infections for the first time since the early days of the pandemic.
Morgan Stanley cut its forecast for China’s economic growth this quarter to zero, as Shanghai locked down construction sites. Long-lasting curbs on movement and manufacturing would present a severe headwind to metals demand due to China’s high proportion of global consumption.
The cooling of metal markets contrasts with the sharp moves higher earlier this month, when both copper and aluminum touched new records. Traders were concerned about disruption to supplies from Russia due to sanctions imposed after its invasion Ukraine. Low exchange stockpiles have exacerbated those fears.
Base metals “have generally been hurt by a double whammy of China lockdown and the general deflation of the war premium,” said Ole Hansen, head of commodities strategy at Saxo Bank A/S. “All helping to offset lingering supply worries from Russia.”
The European Union excluded aluminum, copper and nickel from its latest set of trade restrictions on Russia. The sanctions mostly targeted imports of finished steel products.
Aluminum fell 1.3% to settle at 3,277.50 a ton on the LME at 5:51 p.m. local time. Copper fell 0.3%.
Xiang Guangda, whose large short position roiled the nickel market last week, has secured a deal with his banks to avoid further margin calls, reducing the risk that the squeeze is repeated when trading restarts on the LME.
Benchmark iron ore prices in Singapore declined for a sixth day.
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
