Recently, macroeconomic expectations have resonated positively with the fundamentals of the aluminum market. With multiple favorable factors, the market is generally optimistic about the future trend of aluminum prices, and it is expected to show a pattern of oscillation and strength. ​

Macro warm sentiment: reduced recession risk+clear expectation of interest rate cuts

The current risk of economic recession in the United States has significantly decreased, and the resilience of economic data provides stable support for the commodity market. The direction of the Federal Reserve’s monetary policy has become further clear, and the market’s expectation for further interest rate cuts in October is as high as 85%. Industry analysis points out that if the interest rate cut is implemented, it will effectively reduce market financing costs, enhance market liquidity, and weaken the potential upward pressure on the US dollar index. This is undoubtedly a direct benefit for commodities such as aluminum priced in US dollars. ​

The easing of recession risk in the United States means an improvement in terminal demand expectations, while the expectation of interest rate cuts provides support for commodity prices from the monetary level. Under the dual macroeconomic benefits, the market sentiment in the aluminum market has clearly rebounded. Institutional analysts said that the current macroeconomic environment has gradually shown its support for aluminum prices, and the specific movements of the Federal Reserve’s October interest rate meeting need to be closely monitored in the future. ​

Fundamental stability with progress: supply remains stable+resilience during peak consumption season

From the perspective of the fundamentals of the aluminum market, the current supply side remains basically stable, and there has been no significant fluctuation in the production pace of domestic aluminum enterprises. The release of production capacity is within a reasonable range, and there has been no excess pressure on the market. In terms of inventory, the market expects a concentrated arrival after the “National Day” holiday, during which inventory may accumulate in stages. However, most institutions believe that the extent of inventory accumulation this time will be relatively limited and will not change the long-term trend of inventory stabilization. ​

On the consumer side, the performance continues to improve. Currently, the domestic aluminum market is still in the traditional peak consumption season, and downstream sectors such as construction, automobiles, and new energy have strong demand resilience. Data shows that the operating rate of aluminum processing enterprises has remained at a high level recently, and the order situation is good. Some enterprises have even experienced short-term order queues. The sustained efforts during the peak consumption season will effectively digest the possible temporary inventory growth and provide solid fundamental support for aluminum prices, “said an aluminum industry practitioner. ​

Outlook for the future: Multiple factors combined with strong fluctuations in aluminum prices and materials

From a comprehensive macro and fundamental perspective, the market has strong confidence in the future trend of aluminum prices. Most analysis institutions believe that under the macro background of strong expectations of interest rate cuts by the Federal Reserve and reduced risk of recession in the United States, coupled with the fundamental support of stable supply and strong consumption in the aluminum market, it is difficult for aluminum prices to experience a significant pullback in the short term, and it is likely to maintain a strong oscillation trend. ​

However, the market also reminds us to pay attention to potential risks, such as whether the actual delivery volume and inventory accumulation after the National Day holiday exceed expectations, and whether the implementation of the Federal Reserve’s interest rate cuts meets market expectations. With the gradual disclosure of relevant data, the trend of aluminum prices may experience a temporary adjustment, but the long-term positive trend has not changed yet. At present, the market is closely monitoring macro policy trends and downstream consumption data to further determine the specific operating space of aluminum prices.