Iron ore futures prices climbed to their highest level in several months, driven by hopes of improving demand in China, the world’s largest iron consumer, after Beijing pledged to ease monetary policy this year.
The most-active May iron ore contract on China’s Dalian Commodity Exchange rose 4.1% on Wednesday to close at 828 yuan (USD 118.46) per ton, marking its highest level since July 23.
On the Singapore Exchange, February iron ore futures gained 2.4% to trade at USD 109 per ton as of 12:19 p.m. Mecca time, after touching their highest level since February 21 at USD 109.15.
Analysts said expectations of monetary easing by Beijing in the coming months have boosted overall confidence in the metals market, supporting price gains, especially after the People’s Bank of China announced its intention to cut the reserve requirement ratio and interest rates this year.
Prices were also supported by expectations that Chinese steel mills will restock large volumes of raw materials, amid low inventory levels, ahead of the Lunar New Year in February, according to Reuters.
