Iron ore closed higher on Thursday (11), with prices on the Dalian stock exchange in China rising 1.29%. This increase was driven by two factors:
- Weak Chinese economy data: China’s industrial output grew by 5.0% in March compared to the same month last year, below market expectations of 5.5%. Retail sales growth also fell short of expectations, rising by 6.7% in March. This indicates that the Chinese economy is growing at a slower pace than expected, which could have a negative impact on the global iron ore market.
- Expectation of new stimulus for the economy: The Chinese government has signaled that it is willing to take steps to boost economic growth. The People's Bank of China (PBoC) cut its benchmark interest rate on Wednesday (10) and the government is expected to announce further stimulus measures in the coming days.
Market analysis
Analysts believe that the rise in iron ore prices is a positive sign for the market. However, they warn that prices may still be volatile in the short term, due to the uncertainty of the global scenario.
Factors that can influence the price of iron ore
- Growth of the Chinese economy: China is the world's largest consumer of iron ore, so the growth of its economy is one of the main factors influencing the price of iron ore.
- Chinese government policies: The Chinese government plays an important role in regulating the iron ore market. Government policies can influence the supply and demand for iron ore, and consequently its price.
- Global iron ore production: Global iron ore production and its impact on price Furthermore, global iron ore production also plays a crucial role in determining the price. In this sense, if production increases, the price of iron ore tends to fall. This occurs due to the increase in supply in the market, which generates a surplus and puts downward pressure on prices.
Outlook and recommendations for the iron ore market
The outlook for the iron ore market in the long term is positive. Demand for iron ore is expected to continue to grow, driven by growth in economy global. However, the market may be volatile in the short term due to the uncertainty of the global scenario.
For those investing in iron ore, it is important to exercise caution and monitor the global political and economic scenario. It is advisable to diversify investments and seek protection against market volatility.
Image: Valor Econômico- Globo
