MANILA: Dalian and Singapore iron ore futures rose on Monday, after China cut benchmark lending rates to support its economy, but the price rally is expected to be short-lived as demand outlook remains cloudy.

China cut its benchmark lending rate and lowered the mortgage reference by a bigger margin, adding to last week’s easing measures, as it strived to revive an economy hobbled by a property crisis and a resurgence of COVID-19 cases.

On the Singapore Exchange, the most-traded September contract rose 2.3% to $103.10 a tonne at 0437 GMT. The most traded January iron ore on the Dalian Commodity Exchange rose as much as 2.6% to 698 yuan ($102.26) a tonne, before easing to trade 2.1% higher at the Asia midday break as outlook for demand remained bleak.

“The heat wave and the record high temperature (in China) still exist so that’s destroying construction steel demand. You still got COVID. People are still not on the streets consuming steel intensive goods,” said Atilla Widnell, managing director at Navigate Commodities in Singapore.