Prices have been sensitive to dollar volatility The physical market has shrugged off the recent episode of backwardation in nearby spreads. While tight...
The recent strength in LME aluminium prices seems to be mainly macro driven, reflecting a sharp sell-off in the dollar. The dollar index dropped a whopping 1% last Wednesday, marking its lowest level since December 2014. The sell-off was partly triggered by US Treasury secretary Steven Mnuchin’s comments (“weaker dollar is good for trade”) at the World Economic Conference in Davos. But the dollar index recovered on Thursday after President Donald Trump said Mnuchin was misinterpreted and he expected the dollar to get stronger.
Premiums shrugged off the recent backwardation
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