Texture from Reuters:
Shanghai steel futures managed to push higher on Wednesday despite unexpectedly weak Chinese economic data for July, including a marked slowdown in industrial output growth amid a protracted U.S.-Sino trade war.
“Investors took a glass half full approach to the weak economic data in China, with expectations of extra stimulus measures rising,” ANZ Research said in a note.
Support for steel prices is also seen intact as some Chinese steelmakers have decided to reduce their output to prop up weak prices and thus boost profit margins squeezed by high costs of raw materials.
Whatevs. We’re going lower. The charts:
Spot hit. Paper hit harder overnight. Steel is holding up but not for long.
Fundamentals demand $60 iron ore before the year is out. Much lower if we get shocked.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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