What’s going on here?

Base metals on the Shanghai Futures Exchange (SHFE) climbed after China announced plans to boost its economy through fiscal support and strategic trade measures.

What does this mean?

China is aiming to invigorate its economy with a host of fiscal measures, including increased pensions and medical insurance subsidies, as well as expanding trade-ins for consumer goods. A key part of this plan is issuing 3 trillion yuan ($411 billion) in special treasury bonds next year. This strategic push has lifted metal prices on the SHFE, with the most-traded January copper contract edging up 0.2% to 74,100 yuan ($10,154) per ton. Aluminium and nickel also rose, with prices up 0.2% and 0.7% respectively, while zinc jumped 1.1%. Not all metals followed suit, though — lead prices dipped slightly by 0.3%.

Why should I care?

For markets: Fiscal injections fuel market optimism.

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