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US job growth slowed more than expected in August, with data released on Friday showing total non-farm employment rising by 130,000 – missing the forecast gain of 163,000.
This was followed on Sunday by disappointing Chinese trade data for August; China’s exports unexpectedly contract last month with a year-on-year drop of 1%, this compared with analysts’ forecasts for a 3.3% increase over the same comparison.
As a result, China’s trade surplus shrank to $34.83 billion in August from $44.58 billion in July, according to China’s General Administration of Customs.
“[Sunday’s] China trade data unambiguously confirms that softer global demand and US tariffs continued to weigh on China’s export growth,” Stephen Innes, Asia Pacific market strategist from AxiTrader said in a morning note on Monday.
But there was some positive news out of China last week, too, with the People’s Bank of China announcing a 0.5% cut to the reserve requirement (RRR) by 50 basis points for all banks, releasing 900 billion yuan ($126.5 billion) in liquidity to support the country’s flagging economy.
Against this mixed backdrop the majority of SHFE base metals prices were down this morning, but to relatively modest degrees. The most-traded November copper contract fell to 47,350 yuan per tonne as at 10.41am Shanghai time, down by 100 yuan per tonne – or 0.2% – from Friday’s close of 47,450 yuan per tonne.
Rising red metal stocks at SHFE warehouses were a further headwind to prices; SHFE copper stocks climbed 18,183 tonnes week on week to 162,059 tonnes on Friday.
Nickel was the lone SHFE base metal in positive territory on Monday morning, with the most-traded November nickel contract rising by 1,830 yuan per tonne – or 1.3% – from its close on Friday. Nickel prices continue to be supported by concerns over the impact of the Indonesian ban on ore exports.
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