The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 0.31% lower at 798.5 yuan ($109.79) a metric ton.
The benchmark August iron ore contract on the Singapore Exchange fell 0.83% to $103.65 a ton, as of 0710 GMT. China lowered a key short-term policy rate and its benchmark lending rates in an attempt to boost growth, as the country is verging on deflation and faces a prolonged property crisis, surging debt and weak consumer and business sentiment.
The cuts come after China last week reported weaker-than-expected second-quarter economic data and its top leaders met for their third plenum. The boost, however, failed to fully eradicate concerns after the long-awaited Chinese policy update presented no major shift. “The Third Plenum brought together China’s leaders to map out the general direction of the country’s long-term social and economic policies. But little was done to rectify weak economic growth,” ANZ analysts said in a note.
Weighing on the key steelmaking ingredient was also the fact that major “producers are overcoming recent supply-side issues to boost exports,” ANZ analysts said. Depressed demand from end-users and negative sentiment pervaded the domestic steel market from July 15-19, said Chinese consultancy Mysteel.
