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FutureStarrPhysical Gold Price News Analysis and Trends
Physical Gold price will be influenced by several factors. One of the key factors is inflation. Another is expectations for rate hikes. These factors push the price of gold downward. Another factor is investor sentiment. Goldman Sachs has downgraded its outlook for the gold price in 2013. This will have an impact on the price of gold.
Historically, inflation has played a very important role in the pricing of gold. During periods of high inflation, gold outperforms most other asset classes, particularly stocks. Inflation is defined as an increase in core CPI (cost of living index) prices. Since June, the SPDR Gold Trust ETF is up about 4%, while the S&P 500 and Nasdaq have declined by over 20%.
Gold has been used as a safe asset during periods of high inflation because of its limited supply and inherent value. Although physical gold is not easy to hold, its value tends to hold up during these periods of high inflation. In addition to being a safe haven asset, gold can be an extremely expensive investment. Investing in physical gold may not be for every investor.
Demand for physical gold is driven by the world's central banks. As a result, gold prices have risen sharply in recent decades. Gold prices are currently around $1,850 per ounce. This is due to several factors, including supply and demand, as well as the demand from central banks.
Gold prices are sensitive to global inflation and global macroeconomic factors. Historically, gold prices have been used as a hedge against inflation, and they have a very strong positive correlation with US YOY CPI numbers, with the four years' numbers near 0.33. The price of gold may continue to rise, but in the short and medium term, the market will likely stay in a range.
While there are many factors affecting the inflation rate, one that should be considered by every investor is the money supply. Increasing the money supply will increase consumer and investor demand.
Analysts at Goldman Sachs believe that the price of gold will be impacted by competing forces, such as rising interest rates and rising U.S. real yields. Although gold demand is regaining some of its recent slack, analysts expect it to be below pre-pandemic levels through the end of 2022. Moreover, they expect that gold production will continue to grow throughout the year, and the price of gold is unlikely to exceed its highs in 2022.
Rising expectations of inflation will offset rising Treasury yields and expectations of further Fed rate hikes. This would push the price of physical gold lower even if there are no major inflation worries. On the other hand, rising equities and expectations about upcoming rate hikes would push the price of physical gold higher. Against the backdrop of these developments, the price of gold will likely be supported by strong retail demand from China and India. Meanwhile, central banks are expected to only offer limited support.
On Monday, the Fed chair Janet Yellen's comments at Harvard University were still being digested by traders. While she said that she was optimistic about the US economy's expansion, Yellen also said that it could be appropriate to raise interest rates in a few months.
Higher interest rates will make it more difficult to borrow money and spend it. In turn, the increased interest rates will affect the prices of investment assets, including stocks, cryptocurrency, and precious metals. These higher rates will reduce the incentives to own physical gold.
In recent years, several researchers have focused on the topic of investor sentiment. For example, Debata, Dash, and Han have examined the impact of investor sentiment on the liquidity of 12 emerging stock markets. They also developed market-based sentiment indicators and intraday investor sentiment indicators.
Recent research suggests that market participants are placing a low probability on a strong rebound in the second half of the year. A combination of weak oil prices and solid underlying Chinese and US economic momentum has prompted investors to take a cautious approach to the global economy.
Goldman Sachs has cut its outlook on physical gold prices for 2013 and 2014. The reduction is attributed to a rise in real interest rates that is offsetting the Federal Reserve's balance sheet expansion. The three-, six-, and 12-month gold price targets have been cut from US$1,615 an ounce to US$1,530 and US$1,550, respectively. In addition, the bank also introduced a new forecast for 2014, which suggests that price growth will slow down and possibly reverse.
In its report, Goldman Sachs outlined its gold price forecasts for 2013 and 2014. It noted that gold may reach a new record high in 2013, but that the price may remain limited beyond that. Further, it said that the timing of the peak in gold prices will be closely linked to how well the G3 economies improve. As a result, the new forecast for 2013 and 2014 shows that the price of gold may remain range-bound until early next year.
While Goldman Sachs' outlook has been downgraded, other analysts have remained positive about the future of gold prices. Bloomberg tracks the predictions of various analysts. Among these are Tom Kendall, Jochen Hitzfeld, and Daniel Brebner. Gold prices are likely to reach $1,350 an ounce in the coming years.
Goldman Sachs is a global investment bank. Its headquarters are on 200 West Street in Manhattan, and it has regional offices around the world. It ranks second among investment banks in the world by total revenue. It is a member of the Financial Stability Board and is considered a systemically important financial institution.
Goldman Sachs said it is difficult to predict when the physical gold price will reach a peak because of competing forces. However, it does expect a limited upside. It cited the rising risks, including the fiscal cliff, and said the Fed's balance sheet expansion will likely have a modest effect on the price.
The bank has also increased its forecast for gold, saying it could reach US$ 1,350 per ounce in six months and US$ 1,375 per ounce next year. The analysts cite the growing demand from emerging economies and the weakening dollar as reasons for this optimism.
Gold is currently trading above US$ 1,260 an ounce. Despite the forecast increase, Bank of America Merrill Lynch said it didn't see much room for further gains in the gold price. Bank of America's forecast also assumes the U.S. dollar will continue to weaken. This is a concern for gold investors, because gold's price can only rise further if the Chinese economy is strengthening.
As the economy grows stronger and central banks are spending trillions of dollars to keep economies afloat, the price of gold will rise. That is because the demand for gold will grow as central banks continue to pump trillions of dollars into their currencies. As a result, gold will continue to be the best safe haven for investment. Those who hold gold should do so if they have the money. It's a good time to buy.
The gold price may reach US$ 2,000 in the first half of this year. This would represent a temporary high for the precious metal. It's likely to rise again in the second half of the year. This is due to the strengthening US dollar and speculation about interest rate hikes. In addition, the weakened purchasing power of emerging markets like India and China will continue to keep gold prices pressured.
The note on the USAGOLD has gone from being a minor problem to a major one. From being manageable, transitory, and transitory again, it is now persistent, and it is likely to be a problem if the Fed is too aggressive. However, the current price of gold is not the only factor that has caused this change.
The size of managed money gold positions can have a significant impact on gold prices. When these positions are overextended near a market inflection point, the price of gold can take a quick breather. This can signal a short-term price correction or a market bottom. In other words, it can make the market look oversold.
The data in the chart above show the proportion of managed money long positions against those short. The blue bars represent the number of investors who bet the price will increase, while the red bars represent those who believe the price will fall. In mid to late 2018, there were a relatively small number of managed money long positions and a large number of shorts.
Managed Money silver positions in the gold market have remained low, despite the recent rally in gold. The decrease in these positions can be considered a counter-indicator of rising prices, as they can indicate ambivalence toward gold as an inflation hedge. Nevertheless, if managed money silver positions drop below zero, this could signal a price increase in gold.
Managing money silver positions in the gold market requires a solid knowledge of valuing silver. Silver prices are based on several factors, including the actual value per ounce, historical prices, and real interest rates. It's useful to keep in mind that, historically, silver was valued at 10 to 20 times more than gold, and this ratio remained stable over the long term, despite a few temporary anomalies.
Another way to manage silver positions is to pay attention to economic reports, which will tell you what is happening with the economy. If the economy is experiencing a downturn, investors will flock to safer assets like gold. This would tip the supply and demand scales. Conversely, if the economy is doing well, investors will move away from silver and move into safer assets such as stocks.
The downside of silver is that it is a more volatile asset than gold. During recessions, its industrial demand declines, and the price of silver drops. The price of palladium and platinum, two other precious metals, also fall. The metals are used in a variety of products, from medical devices to microcircuits. Moreover, they are among the most innovative in various fields.
If you are looking to sell your silver position, you should be aware of the market's volatile state and how to manage it. This can lead to difficulty finding a buyer. Silver is not as well known as gold and is more susceptible to economic conditions and pressures on manufacturing firms.
While both gold and silver are a great investment, they have different qualities that make them more attractive to different investors. While gold is more stable and has greater liquidity, silver is less expensive and can provide higher profits. Moreover, its physical volume is larger. It is also more accessible, so the same dollar investment can buy you more silver than gold.
If you are looking for a long-term investment strategy, you may want to consider adding silver to your portfolio. The silver price is now above $19 per ounce, and this is good news for investors. However, it remains well below its recent highs. Despite this, silver has little room for further decline. It is highly demanded in the battery and solar industries.
The recent price of gold is high enough to encourage investors to purchase the precious metal. However, before you make your purchase, you should consider the Forecasts and Analysts' outlooks. This will ensure that you're making the best decision possible. Also, consider how much to invest, and where to get the latest information on the gold price.
CNBC's "Mad Money" host, Jim Cramer, recently discussed the merits of an investment in gold. He explained that it is a smart choice during a time when inflation and the economy are in turmoil, and that it can provide investors with some relief from the rising cost of living.
Before you start buying gold, you should know your options and risks. The most traditional way to own gold is in the form of physical gold bars. You can buy these at banks, though you may need to pay additional fees. A few other methods of holding gold include gold-related stocks. But be aware that these are more volatile than traditional gold investments and may require additional costs.
Gold prices have experienced a strong rally this year. But the recent dip in the price of equities has made investors nervous. Gold has historically been a safe haven during periods of high uncertainty. Because it is less volatile than many other investments, it has historically held a higher price during such times. It also tends to move inversely to the U.S. dollar, so it is more expensive to borrow money. As a result, many investors are now skittish about a possible recession. This has pushed the S&P 500 index into a bear market, with a 20% decline since the start of the year. Gold has the benefit of being a safe haven investment because it tends to rise in value when stock prices fall.
While gold is not a guaranteed investment, it is a safe and stable way to invest for retirement. Many financial advisors recommend that investors invest between 1% and 5% of their total portfolios in gold. While this may seem too small for many investors, the resulting effect could be huge. Gold has been around for thousands of years, and it's one of the oldest forms of currency. It is also available in several investment forms.
In a low-interest rate environment, non-yielding gold tends to perform well. According to Goldman Sachs, investors are set to pour into the inflation-hedging safe haven this year. However, there are some risks associated with gold's price rise. CNBC's Dominic Schnider predicts that gold could be on its way down.
While gold's price may be stable for the time being, it has not responded well to high inflation. Last year, it fell by 7%, finishing the year at $1800. Gold was also hit by a strong dollar and a weak emerging market economy. Gold is not a sure bet, but it is a safe haven investment.
Gold has experienced a "death cross" pattern, which is when the 50-day moving average falls below the 200-day moving average, a bearish signal. The price of gold has dropped over $300 since early March. The Fed's rate hikes, as well as the dollar's recent rally, have contributed to the recent price drop. However, the dollar has eased on Monday, making gold a more attractive investment.
Gold prices bounced back on Friday after the U.S. Federal Reserve raised interest rates by a quarter-point. The Fed's announcement helped to bolster confidence that interest rates will remain higher for a longer period. The looming gas supply crisis in Europe, and a war in Ukraine have kept markets nervous and led to a rise in the U.S. dollar. As long as the dollar continues to rise, gold prices are unlikely to move significantly to the upside.
In recent months, analysts have changed their outlooks for gold. While most expect it to continue its steady ascent, some have lowered their expectations. For example, Goldman Sachs has lowered its forecast for the first quarter of 2013. They still predict the gold price will rise over the first quarter, but the price may only rise to this high for a short time.
Analysts' outlooks for gold are based on current events and the outlook of central bankers. The US dollar and euro remain in a downtrend, but gold is likely to remain resilient. Gold is also expected to be stronger in the near future due to increased demand from investors. There are a number of risks to the outlook, including the continued rise in interest rates. Moreover, the U.S. Federal Reserve is expected to continue buying assets in the second half of 2013, although it is not clear whether it will extend the program beyond the first half of the year.
The rise in nominal rates in the US continues to weigh on investment demand for gold. Rising rates would raise the cost of storing gold, which would dampen its safe-haven appeal. In addition, a pickup in the economy would make inflation expectations more difficult to ignore.
A recent price rally in gold has been stymied by the recent sharp drop in the euro against the U.S. dollar. While the euro jumped after the ECB raised interest rates, it has since pared its gains as the region reels from Russia's war in Ukraine. Geopolitical factors, as well as the massive amounts of debt in the world, are also driving buying interest in gold. The yellow metal is now competing with the dollar for the status of a safe haven.
Gold is now priced in for a 75-basis-point hike next month by the Fed, which is expected to do so in its next policy meeting on September 20-21. Historically, the Fed has raised rates in the past to combat inflation. The move by the Fed could cause the yellow metal to slide below $1,700, but the price of gold is still at multi-decade highs.
The market will be influenced by the Fed's next move, especially after the U.S. consumer prices were flat in July, after increasing 1.3% in June. Moreover, China's economy unexpectedly slowed in July, which is a key buyer of gold. Also, the UK's inflation numbers are due soon, which could help to determine the direction of interest rates there.
The dollar's strength is another reason why gold is under pressure. The dollar recently turned negative before resuming its upward trend. The stronger dollar makes gold a more expensive asset for buyers from abroad.
Although gold has historically offered investors a decent rate of return, it is not an ideal inflation hedge. In a recent study by Arnott, who examined the returns of various asset classes during periods of above-average inflation, gold actually lost value. Between 1980 and 1984, when the annual inflation rate was 6.5%, gold's price fell 10%. From 1988 to 1991, it lost value again, declining by 5%.
Unlike Bitcoin, physical gold is not a good inflation hedge, but physical gold is a safer bet. You can purchase bars, coins, or jewelry in order to protect your money against depreciation and inflation. Physical gold is typically sold at a premium to its spot price. However, buying it from a dealer will likely require a high discount due to transportation, insurance, and security risks. Additionally, you have to consider whether you want to invest in coins or bars with numismatic value.
The main measure of inflation in the US is the consumer price index (CPI). Gold and CPI have poor correlations. The high inflation of the 1970s and early 1980s led to strong returns for gold, but the relationship has since been weak. While gold is a great store of value in the long term, the relationship between gold and the CPI is less favorable today.
If you're considering investing in gold as a hedge against inflation, you must be aware that it's not an investment like stocks or bonds. It does not pay dividends and earn interest, and it is subject to bouts of volatility. Regardless of the volatility, gold should still provide positive real returns in the long run.
Investing in gold as a safe asset is a great way to diversify your portfolio. The rise in global political and economic turmoil has led many to turn to gold as a safe haven. There are some important things to consider when investing in gold. Talk to a financial advisor to learn more about how you can make the most of your investment.
Investing in gold is different from investing in stocks. In a safe haven investment, there is no correlation between the price of gold and the prices of other assets and markets. This allows you to avoid large losses during periods of high volatility and stress. This is particularly helpful during economic crisis.
Investing in gold as a safe-haven is also a good idea if you're worried about inflation. Gold tends to retain its value, so it can serve as an excellent hedge against inflation. Gold has the advantage of being a safe haven despite the fact that its entry price is high. The downside to physical gold is the massive markup that is required to buy it.
Investing in gold as a safe-haven is an excellent way to protect your money from market turmoil and can earn you sizable short-term gains. However, it's important to research the various methods of investment and choose the one that works best for you. Consider factors such as the amount of capital that you invest, your liquidity needs and your investment goals.
If you're looking for information on base metals, then you've come to the right place. This website features live prices for copper, lead, zinc, nickel, and aluminum, along with historical charts and news. It's the world's largest site dedicated to base metals.
KITCO Metals Inc. is one of the largest precious metals companies in the world, and its trading volume jumped from $369 million in 2014 to $4 billion in 2016. Since then, it has become a popular stock among investors and traders. The company offers a wide variety of metals and products, including gold and silver.
ANZ's forecasts for industrial materials are generally positive, albeit with several risks. First, demand for industrial metals is still depressed despite the easing of supply constraints across most metals. Second, the easing of supply challenges will not be enough to replenish inventory levels. Hence, a short-term correction in prices may occur.
Despite these headwinds, industrial metals prices are expected to recover in the second half of 2020, driven by resurgent Chinese demand propelled by the infrastructure-led stimulus drive. This will initially push demand for iron ore, copper, zinc, nickel and cobalt. After peaking in March, copper, zinc, and cobalt prices are expected to recover, supported by improved consumer spending in the second half of 2020. Additionally, the conflict between Russia and Ukraine is likely to push raw materials prices higher.
The report predicts a national price rise of four to eight percent over the next few years. However, smaller markets are expected to be harder hit than larger ones, with Perth, Tasmania, and Brisbane seeing the highest cost escalations. For those looking to manage their projects and budgets, project management software can be a valuable tool.
Nickel prices may rise further during the period as delays in the production of the metal could force prices up more than expected. However, monetary tightening and the risk of recession are likely to dampen demand. ANZ Research's forecasts for industrial metals indicate that the price of nickel could reach $25,350/tonne in 2022 and $23,700/tonne in 2024.
The ANZ China Commodity Index ended last week higher by 1%. Last week, the energy sector led the gains, while the US Federal Reserve tapering helped the market to recover from its recent shock. In addition, iron ore prices stabilized late last week, which helped the bulks sector to recover. These factors support industrial metals' overall recovery.
ANZ's aluminium forecasts for China are cautiously optimistic. The Middle Kingdom is already one of the world's largest consumers of the metal, and the increase in its demand should lead to higher prices. Nonetheless, the outlook remains rosy, with ANZ predicting a 3.1% growth rate in demand for aluminum in China by 2022.
The country is also facing a power shortage, which will increase the demand for copper and aluminium. The shortage has forced China to delay planned grid investments. This could also prompt Beijing to accelerate renewable energy projects. But Beijing has historically relied on coal to deal with power shortages. It's not clear if it will be able to make the necessary investments in renewable energy.
Despite recent price hikes, China's aluminum production remains highly energy and carbon-intensive, and it's likely that the price will remain high for years to come. Currently, more than 80 percent of China's aluminum production comes from coal-fired power plants. According to the World Bank, the cost of aluminium in China will rise to US$2,000 per metric ton by 2021, with prices reaching $2,050/t by 2022.
In the long run, China's growth in aluminum output will slow. The rise in output in China is unlikely to be enough to offset any additional supply cuts in Europe. ANZ's forecasts suggest a global aluminium deficit of 2.5 Mt this year, which could expand to three million tonnes by 2022. However, Chinese investment in ultra-high-voltage power lines will increase the demand for aluminium.
ANZ's aluminium forecasts highlight the need to protect against further supply disruptions. The recent rise in energy prices is also a risk factor. ANZ warns that China may be too confident in its ability to meet any shortfalls. In addition, it says that ongoing supply reforms will cut the surplus of aluminium available for export.
Copper prices have surged in recent months and are poised to set a new record. The increase is attributed to a strong demand in China, the world's top copper consumer. However, the outlook for supply is mixed. Many mines in Latin America are facing short-term difficulties and new construction is slow.
While the global economy is growing, some analysts believe that the global demand for copper is slowing. This is due to the fact that China is undergoing a major transition to renewable energy. This shift will require more copper than previously expected. Meanwhile, BMO Capital Markets is more bearish and has cut its copper forecasts.
In addition to renewable energy projects, the development of the Chinese grid will require large amounts of copper. This metal is used in power cabling and photovoltaic panels. The power sector accounts for 36% of global copper demand, so it's important to keep this in mind. ANZ expects a 3.6% year-on-year growth in Chinese copper demand in 2022, with 6.5% growth by 2023.
While there has been a sharp drop in copper prices, the recovery has been robust in recent months. The Chinese government has been supporting the property sector, which should boost demand later this quarter. Meanwhile, the ShFE copper inventory fell by 78% year-on-year to 37,025 tonnes. This is the lowest quarterly level since the financial crisis. Additionally, increasing interest rates worldwide and the potential of a global hard landing have increased concerns regarding copper prices.
While iron ore demand is slowing, it is expected to remain tight. Demand outside China will be able to offset the weakness, limiting the downside. ANZ expects iron ore prices to fall to US$170/t in the December quarter and to remain weak through 2022.
ANZ's nickel forecasts are based on assumptions that the global demand for nickel is growing steadily. However, there are certain risks that could push the price of nickel higher than anticipated. These include delays in production capacity, global recession risks, and monetary tightening. Therefore, it's important to do your own research before investing in nickel. Moreover, remember that past performance is no guarantee of future results, so you shouldn't risk more money than you can afford to lose.
Meanwhile, other analysts have changed their nickel forecasts. TD Bank, BMO, and Desjardins Securities have all cut their nickel forecasts for the coming year. They also cut their nickel forecasts for 2010 and 2009. ANZ's new nickel forecast is at $4.50/lb, down from $5.70/lb in 2008. In addition, Macquarie cuts its 2010 forecast and predicts nickel to average $4.50/lb by the end of 2009.
ANZ's nickel forecasts are based on current data and projections from various sources. The latest forecasts are based on Indonesian mine production. The country is currently the top producer of nickel. Its future production is expected to increase by 62,000 tonnes next year and to become a 78,000-tonne surplus by 2022. The upside risk, however, lies in further restrictions on Indonesian exports. Further Indonesian export restrictions may also increase the price of nickel, which could push it further higher.
If you're considering investing in KITCO Metals, you should know that you've got a lot of options. They have a dedicated team of journalists who write about precious and base metals markets and other market commentary. You can find plenty of useful information on their website, which includes tons of market commentary and news.
Kitco is one of the leading news companies in the precious metals industry and a leading source of gold and silver price quotes, charts and expert commentary. The company buys and sells investment-grade precious metals such as gold and silver bars and coins. They have an app that lets you track and analyze gold and silver prices and have news on gold and silver prices.
The news coverage at Kitco is extensive and covers a wide range of topics, including fundamentals, technical analysis, commitment of traders, and market trends. The news team incorporates the expertise of its own journalists as well as those of other industry professionals and journalists to present an informed and objective viewpoint.
The KITCO Media division generates and disseminates cutting-edge news, data, and market insights for a global audience. KITCO's news, charts and quotes are available around the clock and in real-time. The company's website is one of the most comprehensive of its kind and contains news on gold, silver, copper, lead, zinc, and other base metals.
Kitco's history starts in the 1970s, when Bart Kitner, a college student, bought scrap gold and sold it back to the market. After graduating, he continued to build his business. His part-time job soon turned into a full-time career, and he grew the company to accommodate his growing interest in computers and the web.
The KITCO Metals Base Industrial Metals stock market website can benefit from optimization of the HTML content. Compressing content using GZIP or minifying it can reduce the number of requests between your browser and the website. This will increase your site's load speed.
The current crisis in Russia-Ukraine is the first major interstate conflict in the metals sector since the US started focusing on critical minerals in the decade that began with the Chinese embargo on rare metals exports to Japan in 2010. The US Geological Survey modeled the implications of the disruption in Russian metals exports during 2017, noting the importance of market dynamics.
It is possible that Western governments may consider imposing sanctions on Russian critical metals, potentially harming vital industries and disrupting the energy transition. Indeed, the recent US sanctions against Alrosa may be just a sign of things to come. In addition, the current Russian-Ukraine crisis will also increase the urgency of national-security-based assessments of the supply chains of critical minerals.
The price of copper has soared in recent days, and it is now trading at eight-month highs. This is due to several factors, including the recent economic downturn. New home starts fell to their lowest level in eight months last week, while China has cut back on real estate investments. In Europe, meanwhile, concerns over the long-term growth of the country have led some investors to fear that deflation could set in, which would push down prices of all assets.
While ANZ has downgraded its short-term forecast for base metals, it remains optimistic for the long-term. In addition, the Chinese central bank is trying to fight against inflation by tightening monetary policies. This is putting pressure on metals prices around the world.
On Monday, copper prices bounced back, as bearish investors bought back positions, and the weaker dollar helped to support prices. The three-month contract on the London Metal Exchange jumped 3.3%, or $7,427 per tonne. It had fallen to $6,955 in the previous session, its lowest level since November 2020.
Copper prices were supported by technical and fundamental factors this week, with technical charts adding further support. According to Standard Chartered bank, a move above $6,880 metric ton is technically price-positive. The next resistance is at $7,043 and an inverse head and shoulder pattern could suggest a rally to $7,800. As a result, copper prices are showing signs of bottoming. However, the market needs to see if moving averages turn bullish before the price goes higher.
A steady demand for copper on the LME is likely to continue, although the prices fell a day after the start of the week. Meanwhile, the price of tin on the LME fell 6.6%, falling to $33,410 a tonne. The fall in price reflects concern over global supply, as European producers are reducing output. Further, as the world shifts toward electrification moves ahead, copper is going to be a necessary element in the process.
Aluminium futures are one of the most liquid commodities on the market. The price of aluminium varies widely. It is an important component of the manufacturing of automobiles and plays an important role in energy efficiency. China is the world's largest producer of aluminium, while India, Canada, and the United Arab Emirates also produce large amounts.
Supply concerns are fueling a selloff in aluminium. China's ongoing COVID-19 outbreak and lockdown measures have disrupted the supply chain, limiting the country's ability to process and distribute aluminium. In the past year, inventories of aluminum in LME warehouses around the world fell from almost two million metric tons in March 2021 to just seven million tons on March 18. The latest sanctions on Russia also exacerbate an already tight supply picture in the aluminum market.
A number of factors have impacted the price of aluminium, including the supply of aluminum in China and a global shortage of energy. The world's largest producer of aluminum is China, which has imposed output limits on some smelters this year and will enforce carbon emission rules in 2020. These factors have reduced Chinese supplies of the metal at a time when demand is increasing.
The recent global economic slowdown has weighed on many commodities. However, the price of aluminum has been able to buck this trend. Several analysts have noted that a growing supply shortage is driving aluminum prices. China's output is only slightly higher than last year and has declined in four of the past five months. As a result, global inventories are now near long-term trends.
The latest economic reports have pointed to a possible recession. China's new home construction activity fell to an eight-month low this week and a U.S. tax credit expired, which slowed investment in real estate. Furthermore, some market watchers have expressed fears about the long-term economic growth of Europe, which could lead to deflation. This would lower the value of all assets.