Zinc prices fell -0.42%, setting at 227.15, driven by pressure from a stable dollar ahead of the United States (US) economic data. Furthermore, the mood of the market was affected by China’s muted demand outlook, which is the largest user of zinc. A reduction in Chinese bank reserves supported the market.
Which added about $140 billion to the banking system, so the downside was minimal. In an effort to increase liquidity. China’s central bank announced a large decrease in the quantity of cash banks must maintain as reserves.
Data from the International Lead and Zinc Study Group (ILZSG) showed that, in November 2023. There was a 71,600 metric tonne global zinc market deficit, up from 62,500 tonnes in October.
China’s December 2023 refined zinc production reached 590,900 metric tonnes. Up 2.05% on a monthly basis and 12.38% on an annual basis.
From January to December, 6.622 million metric tonnes of refined zinc were produced, an increase of 10.77% over the same period last year. Furthermore, China’s production of zinc alloys rose by 9,600 metric tonnes per month to 102,900 metric tonnes in December.
Technically, the market saw long liquidation as prices dropped by -0.95 rupees and open interest dropped by -1.73% to settle at 3288. Zinc has support at 226.2; a break below it could take prices as low as 225.2. Resistance is anticipat at 228.2. And a move above it could take prices as high as 229.2.