MANILA: Shanghai steel futures climbed 1 percent on Thursday, recovering from a two-day slide, after China said it was considering to use monetary policy measures to support its economy amid rising trade tensions with the United States.
China's state radio quoted a cabinet meeting as saying on Wednesday that Beijing will use targeted reduction in banks' reserve requirement ratios and other monetary policy tools to boost credit support for small firms and keep economic growth steady.
"This is all a positive development for China, to support their domestic economy while at the same time grappling with escalating trade frictions with the United States," said Helen Lau, analyst at Argonaut Securities in Hong Kong.
The most-active October rebar contract on the Shanghai Futures Exchange
China's commerce ministry accused the United States of being temperamental over bilateral trade issues, and warned that the interests of U.S. workers and farmers will ultimately be hurt.
The price of construction steel product rebar slid 2.9 percent on Tuesday in a broad-based selloff that also hit iron ore and other commodities amid worries that a growing trade row between Beijing and Washington could hurt the Chinese economy.
Trump had threatened on Monday to hit $200 billion of Chinese imports with 10 percent tariffs if Beijing retaliated against his previous target of $50 billion in imports to which China has responded in kind.
The most-traded September iron ore contract on the Dalian Commodity Exchange
Coking coal
Iron ore for delivery to China's Qingdao port <.IO62-CNO=MB> rose 1.9 percent to $67.69 a tonne on Wednesday, rebounding from the previous day's two-week low, according to Metal Bulletin. - Reuters
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