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Dalian iron ore futures inch lower despite easing China COVID curbs

Dalian iron ore futures inched lower on Thursday, despite the easing of strict COVID-19 curbs in some cities in top steelmaker China following a recent string of protests lifting demand sentiment.

The most-traded January iron ore on China’s Dalian Commodity Exchange ended day-time trade 0.1% lower to 766.5 yuan ($108.58) a tonne, off an earlier high.

On the Singapore Exchange, the benchmark December iron ore was up 2.1% at $102.80 a tonne, as of 0710 GMT.

China is softening its tone on the severity of COVID-19 and easing some coronavirus restrictions even as its daily case toll hovers near record highs, after anger over the world’s toughest curbs fuelled protests across the country.

Mainland China’s Health Commission reported 36,061 new coronavirus cases for Nov. 30, compared with 37,828 new cases a day earlier.

Market sentiment was buoyed by the apparent shift in China’s zero-COVID strategy. However, weakness in the property sector persists – new home sales by the 100 biggest producer developers dropped 26% year-on-year to CNY 559bn in November, ANZ said in a research note.

China’s factory activity shrank in November as widespread COVID-19 curbs disrupted manufacturers’ output.

Global miner Rio Tinto said on Wednesday its iron ore shipments in 2023 would be in the same range as this year’s forecast, and warned costs would be higher.

Asian equities jumped, while the dollar slid as investors poured into risky assets after U.S. Federal Reserve Chair Jerome Powell opened the door to a slowdown in the pace of monetary tightening.

The most-active rebar contract on the Shanghai Futures Exchange rose 0.2%, hot-rolled coil rose 0.3%, wire rod SWRcv1 rose 0.9%, and stainless steel rose 0.4%.

Dalian coking coal DJMcv1 and coke DCJcv1 both fell 3.2% and 2.3% respectively.
Source: Reuters (Reporting by Matthew Chye; Editing by Rashmi Aich)

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