BEIJING- Iron ore futures rebounded on Thursday, as an escalating Sino-US trade war lifted expectations of Beijing announcing more aggressive stimulus measures to counter the negative impact of the tariffs.
On Wednesday, top metals consumer China, in response to US President Donald Trump hiking duties on Chinese goods to 104 percent, said it would raise tariffs on US imports to 84 percent from 34 percent earlier.
Trump retaliated with an even higher 125 percent tariff.
The most-traded September iron ore contract on China's Dalian Commodity Exchange (DCE) climbed 3.13 percent to 707.5 yuan a metric ton, after falling to their lowest in more than six months on Wednesday.
The benchmark May iron ore on the Singapore Exchange added 1.13 percent to $95.85 a ton. It hit an intraday high of $99.5 earlier in the session.
“The prospect of a prolonged trade war has also raised expectations for Beijing to unveil more aggressive stimulus measures” ING analysts said.
China needs to implement more proactive macroeconomic policies and roll them out promptly as “external shocks” have pressured China’s economic stabilisation, Premier Li Qiang said.
