BEIJING: Iron ore futures climbed on Wednesday to their highest levels in nearly two weeks as China’s latest stimulus measures and hopes of easing trade friction between the world’s two largest economies bolstered investor sentiment.
The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) traded 0.78% higher at 711 yuan ($98.47) a metric ton as of 0154 GMT.
The contract touched its highest since April 24 at 726 yuan a ton earlier in the session. The benchmark June iron ore on the Singapore Exchange gained 0.81% to $98.3 a ton after scaling a nearly two-week peak at $99.85 earlier.
The People’s Bank of China (PBOC) will cut the amount of cash that banks must hold as reserves by 50 basis points, the first reduction in 2025, as policymakers seek to support the economy amid a protracted trade war with the United States.
“The magnitude of this round of stimulus somewhat beat our expectations and that’s the main driver for the price strength,” said a Singapore-based iron ore trader, requesting anonymity since he isn’t authorised to speak to the media.
Additionally, positive signals for the potential easing of the global trade war lent some support to prices. US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China’s top economic official in Switzerland on Saturday, in what could be the first step toward resolving a trade war disrupting the global economy.
Steel benchmarks on the Shanghai Futures Exchange gained ground. Rebar added 0.39%, hot-rolled coil rose 0.59% and stainless steel advanced 0.67%.
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