12 March 2012 10:08 [Source: ICIS news]
SINGAPORE (ICIS)--China’s linear low density polyethylene (LLDPE) futures continued to increase, rising by 1.05% on Monday, amid increasingly bullish sentiment on improved internal and external market conditions, industry sources said.
May LLDPE futures, the most actively traded contract on the Dalian Commodity Exchange (DCE), closed at yuan (CNY) 10,575/tonne ($1,676/tonne), up by CNY110/tonne from the previous settlement price of CNY10,465/tonne on 9 March.
Around 1.01m tonnes of LLDPE, or 403,382 contracts were traded for delivery in May, according to DCE data.
“Recently, the external environment has improved in view of the recovering US economy and relief for the European debt crisis. Also, the improvement in US employment data directly boosted upstream crude,” said a futures broker in Shanghai.
The consumer price index (CPI), the main gauge of inflation, fell sharply to a 20-month low of 3.2% in February, from 4.5% in January, the National Bureau of Statistics announced on 9 March.
“The decreased CPI shows that inflation is being curbed, which gives the market opportunity to rise because of stronger expectations of further loosening in monetary policy,” the broker added.
An LLDPE trader in Zhejiang added that a continual hike in local producers’ prices is expected to further push up spot and futures prices.
($1 = CNY6.31)
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