Research Team at Deutsche Bank, notes that the iron Ore was catapulted 18.59% higher (the largest single day gain with daily data going back to 2009) on hopes that the weekend showed China’s willingness to boost economic growth.
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“In fact, Iron Ore has been one of the most impressive performing commodities this year and with yesterday’s move is now up 46% YTD so far as well as a massive 66% from the record lows made back on December 11th last year.
Yesterday’s move reflected to some degree a replenishing of Chinese steel mills supplies ahead of the ramping up of the summer construction season, as well as aggressive moves in Steel prices in expectation of demand recovery triggered by property policies and also abundant liquidity in the system. While similar commentary still remains cautious on the sustainability of such gains for now, further news overnight of a possible joint-venture of sorts between two of the biggest four producers, Fortescue and Vale, is keeping the market squarely in the spotlight for now.”
(Market News Provided by FXstreet)