Steel market in June, will probably be reversed; continuous positive policy stimulus will lead to the terminal steel demand is slowly release; analyst give such a prediction, based primarily on the central bank cut interest rates by 0.25 percentage points on June 8; The analysis pointed out that interest rate cuts, although it is a major positive, steel prices may confirm the bottom of the power; terminal downturn has been a long time production activities is whether the steel prices tend to rise, and needs further observation.
According to the latest news today, the central bank policy down deposit and lending rates by 25 basis points, but it also provides that the deposit interest rate can go up 1.1 times to rise to 3.575%; minimum lending rate to 0.8-fold, to 5.048% . Allow the floating rate is too high, in the case of a rate cut, banks or face the prospect of purchasing and storage deposits reduce the adverse effects of, resulting in the latter part of the bank to reduce the size of loans; so unaffected by the market, bank deposit interest rates of the independent top grid possibility there is an infinite zoom possibility. This may cause the results is the deposit interest rates, loans, the same pattern.
Another aspect, the central bank after a lapse of three and a half to restart the interest rate cut tool from the side of China's economic weakness has to be able to endure the limits of determination of national steady growth under the same time should be standing May cpi index may further sharp decline in the upper has cut interest rates to set aside enough space.
Are very different from the current round of rate cuts and the previous drop quasi-stimulation on the real economy will be more direct; at the same time we have to worry about, just drop late cpi index will be under pressure; the risk of inflation along with interest rate cuts to promote price rise to. Including prices, including stimulating price rebound may be imminent in the near future, the injured is almost or to the bottom of the people-based; Bureau of Statistics released on the 9th May cpi index for the 3% already in the market is expected within , we are more worried about the central bank cut interest rates will force the inflation resurgence.
The real estate industry may usher in the price and volume synchronization rebound to cut interest rates to make the mortgage interest rate direct decline in steel demand to increase loans to purchase housing prices will thus formally through the most difficult period of time; With the real estate industry destocking acceleration, developers, loans, capital returns will be more relaxed, bullish, while real estate developers of new real estate development efforts will also be strengthened, as the real estate industry, which occupy 54% of steel consumption may once again usher in the investment overweight, long-term downturn in the steel market demand will also usher in a release window.
But the current steel market situation, interest rate ability to disperse shrouded in the haze of the industry over, I is not very optimistic; since the end of 2011, steel prices difficult to up the source of more than four points: 1, steel production, excessive , making the supply far exceeds demand; industry downturn, the downstream end of production activities significantly weakened difficult to restore;, steel mills continued to drift lower ex-factory price, market mentality vulnerable die hard; 4, the steel trade and capital-strand breaks increased risk, middle market transactions dropped to freezing point, the market was very thin atmosphere of haze is hard to change.
The upstream steel production capacity has begun to slow down, and Steel   Association data show that in June 8, 1.6122 million tons, the average daily crude steel production of the key steel enterprises in late May, late ring down 4.72%; Estimated average daily production of the national steel 1.9596 million tons, the mid-ring, down 3.92 percent. With the steel mill maintenance shutdown planned increase in post-production capacity is expected to maintain 200 million tons of the following locations; but will remain at a relatively high level of short-term supply-demand relationship is difficult to achieve a delicate balance, continue to constrain the rising steel prices space.
Steel market in the middle of transactions due to financial pressure is difficult to heavy volume control policy; from the recent the Zhouning Steel Trade and Chamber of Commerce collective letter to the major banks shows that Shanghai as the country's largest steel trade enterprise gathering place, there have been a serious risk of funding strand breaks; under the steel trading business loans is difficult to directly enjoy the benefits of cutting interest rates to bring, so we think that even if the positive stimulus is strong under the middle of the steel market transactions may be released, but the amount is clearly not much difficult, steel prices continued to rise large driving force.
Perhaps the effect will be reflected in the real economy enterprises, but in the case of downstream lower consumer demand, production activities can be increased, mainly looked to the development of the inventory level, if you can not stimulate the upgrading of the terminal consumption, production whether a company will bring subtle borrowing costs lower against the market trend to an increase in production activities, to change its established policy, we are more worried about.   It is also concerned about the rate cut the main point of whether real stimulate demand. But the steel price trend in June, the market mentality to a good situation, as well as taking into account the upcoming major projects started approaching, steel prices to achieve the possibility of basing.



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