Aluminium prices slipped as the U.S. dollar strengthened

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Aluminium prices slipped as the U.S. dollar strengthened

Aluminium prices experienced a decline of -0.82%, settling at 200.15, driven by a strengthened U.S. dollar. However, concerns over supply shortages limited further losses. Positive data from China, indicating a surprising expansion in factory activity in November, initially supported market sentiments. Chinese aluminium production for October 2023 recorded a notable increase, reaching 3.641 million metric tons, reflecting a growth of 6.7% YoY. 

Globally, primary aluminium output in October rose by 3.9% YoY to 6.116 million tonnes, according to data from the International Aluminium Institute. The data revealed a substantial rise in imports in October, increasing by 221.19% YoY and 7.9% MoM to 216,600 metric tons, while exports declined 4.67% YoY and 91.29% MoM to 600 metric tons. Chinese regulators, including the People's Bank of China, are reportedly developing a "whitelist" lending support specifically for 50 property developers. On the global front, a major aluminium producer offered Japanese buyers a premium of $95 per metric ton for January-March primary metal shipments, indicating a 2% decrease from the current quarter. 

From a technical perspective, the market is under fresh selling, witnessing a gain in open interest by 5.08% to settle at 4179. Prices have decreased by -1.65 rupees. Aluminium is currently finding support at 199.4, with a potential test of 198.7 levels on a further decline. Resistance is likely at 201.2, and a breakthrough could lead to a test of 202.3 levels.

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