FX.co ★ Iron Ore Falls to One-Month Low on Weak China Data

Iron ore futures declined to approximately CNY 773 per tonne on Friday, marking a one-month low following a series of disappointing economic reports from China, the world's leading consumer. Industrial production in China expanded by 5.7% in July, a decrease from June's 6.8% growth and below the anticipated 5.9%. Retail sales increased by 3.7%, down from 4.8% in June, failing to meet the expected 4.6%. Additionally, new home prices fell by 0.3% compared to the previous month, following a 0.4% decrease in June, highlighting weak property demand despite new incentives from local governments aimed at homebuyers. Concurrently, China's crude steel output dropped to a seven-month low in July as part of ongoing efforts to address overcapacity issues. Furthermore, hot weather and heavy rainfall adversely affected outdoor construction activities. Consequently, steel mill profitability has turned positive, which could potentially provide some support to iron ore prices in the near future.