The price of iron ore has extended its recent retreat, amid unrelenting negative sentiment about inventories of the steel-making raw material in China and demand for steel in the nation.
Iron ore slid 1.3 per cent to $US79.36 a tonne on Monday night, extending its pullback from its February 21 high of $US94.86 to more than 16 per cent. It’s now at its lowest since January 9; it ended 2017 at $US78.87 a tonne. China’s futures markets were closed due to a public holiday.
“Traders are now concerned about the physical capacity at ports and their ability to hold any additional iron ore if the current pace of increases continues,” ANZ said.
The latest price setback for iron ore also comes as China’s central bank seeks to cool the nation’s property market by gradually tightening monetary policy through liquidity controls and higher market interest rates. Over the weekend, the People’s Bank of China lifted rates for loans for small- and medium-sized financial firms.
In addition, there are concerns about what may emerge from this week’s meeting of China’s President Xi Jinping and US President Donald Trump in Florida. Mr Trump has been hammering away at China for months about the value of its currency and the loss of US manufacturing jobs, but has yet to take any concrete action.
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