Iron ore spot prices jumped on Friday, mirroring the turnaround seen in future markets earlier in the session following the release of hotter-than-expected Chinese consumer and producer price inflation figures in September.
The spot price for benchmark 62% fines rose by 1.08% to $57.28 a tonne, according to Metal Bulletin, leaving it sitting at the highest level seen since September 9.
For the week it added 2.54%, extending its gain in 2016 to 31.5%.
The lift in spot markets coincided with the release of hawkish producer price inflation (PPI) data from China earlier in the session. For the first time in nearly five years, producer prices rose in year-on-year terms in September, reflecting higher commodity prices and renewed strength in China’s industrial sectors.
Suggesting that the bullish price action witnessed on Friday will continue today, Chinese iron ore futures continued to push higher on Friday evening with the January 2017 contract last trading at 443 yuan, up 2.55% for the session.
It currently sits at highs not seen since late August.
There were similar gains recorded in coking coal and rebar futures, suggesting that the broader move was linked to sentiment towards the outlook for steel demand.
Trade in Chinese futures will resume at midday AEDT.
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