SMM

HRC prices weakened significantly this week. In the spot market, demand was moderate, with end-users mainly purchasing as needed, leading to a decreasing trend in overall transactions. Looking ahead, on the macro side, RRR cuts and interest rate cuts did not materialize this week, but there is still an expectation for them to be implemented in the long term. Internationally, the US Fed announced its March interest rate decision, maintaining rates unchanged, slowing down the balance sheet reduction, raising inflation forecasts, and lowering economic growth projections. On the cost side, ore prices are expected to rebound slightly, while coke prices remain stable, potentially providing a slight boost to HRC costs. Fundamentally, HRC supply decreased while demand increased, with end-use demand being moderate, and HRC inventories continued to decline. In summary, the fundamental situation of HRC has improved, with a relatively small supply-demand imbalance, supporting market expectations. The most-traded HRC futures contract is expected to trade within the 3320-3450 range next week.