Also, over that same time frame, total reported stock levels declined by a small amount.
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On a geographic basis, drop-offs in China, Australia, India and the U.S. were the main contributors to a global lead mine production decrease of 5% for Q1 2016 (compared to Q1 2015).
On a global scale, refined lead metal output decreased 1.8% during the first four months of 2016, compared to 2015, due primarily to lower reported output in China. This offset the gains made by Canada and the Republic of Korea.
“Ex-China usage of refined lead metal rose by 4.2% mainly due to an increase in European demand of 8.8%,” the ILZSG stated. “However, Chinese apparent usage fell by 12.1% and overall global demand decreased by 2.5%.”
The Fed and Metal Prices
Our own Raul de Frutos recently wrote about the Federal Reserve leaving interest rates unchanged while lowering the outlook for rate increases in the future. What impact does this have on metal prices?
“Higher rates mean higher borrowing costs, which usually make a currency more attractive to investors seeking higher yields than in other currencies,” de Frutos wrote. “So, basically, higher rates domestically (or expectations of a rate increase) normally translate into a stronger dollar which leads to lower metal prices. This happened in May, when the U.S. dollar strengthened amid new expectations that the Fed would raise rates in June or July. Consequently, base metals fell.”
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