Bullish sentiment cooled Shanghai aluminum market weakened intraday

On the macro front, the US CPI rose 7.
5% year-on-year in January, the highest level since March 1982, higher than the previous reading of 7% and expectations of 7.
3%, and the expectation of a 50 basis point rate hike in March rose from 30% to 57%.

Domestically, China's social financing increased by 6.
17 trillion yuan in January, compared with 2.
37 trillion yuan in the previous month
.
China added 3.
98 trillion yuan in new yuan loans in January, compared with 1.
13 trillion yuan
in the previous month.
China's M2 money supply rose 9.
8% y/y in January vs.
9% prior; M1 increased 2% y/y and 3.
5%
prior.
The increase in social financing has rebounded significantly, the steady growth effect has gradually landed, and the commodity market is favorable
.

In terms of inventory, as of February 10, domestic social stocks increased by 84,000 tons from the beginning of the week to 950,000 tons, and the overall accumulated inventory was at a median level compared with the same period of previous years
.

The latest release of domestic electrolytic aluminum social library increased by 84,000 tons to 950,000 tons from Monday, and aluminum rod stocks increased by 17,600 tons to 267,500 tons, and all major consumption places showed seasonal accumulation
.
Although the accumulation is not as expected, from the spot point of view, after the aluminum price soared rapidly above 23,000 yuan / ton in the short term, the downstream fear of heights reappeared
.
East China has abundant supplies, a slight expansion of discounts, and weak transactions
.
South China was affected by the epidemic supply in Guangxi Baise and the market trading was active, and the transaction volume picked up
.
Downstream processing enterprises in Henan are afraid of heights and affect their willingness
to purchase.
The quotation of aluminum rod processing fees in Foshan was lowered, and the transaction performance was still not strong
.

At present, the supply of aluminum at home and abroad continues to shrink, the improvement of the consumer side is clear, and the relatively low inventory under the holiday accumulation is not as expected, which is amplifying the impact of supply and demand disturbances, in line with our previous expectations
.
In the medium term, it is still recommended to buy on the dip and participate in the peak season rise
.
However, 23,000 yuan / ton is the pressure range observed since the fourth quarter of last year, focusing on the change
in downstream sentiment after the sharp rise in prices.