Nickel prices fell during Thursday’s trading amid a stronger US dollar against most major currencies, as well as an increase in global supply of the industrial metal.

While base prices remain steady for now, nickel overall continues to show weakness, keeping stainless steel surcharges capped at limited levels. Although prices have moved sideways in recent months, the broader multi-year trend still points to the downside.

At the same time, nickel inventories remain exceptionally high. Indonesia has maintained robust output, with nickel surpassing coal as the country’s largest export in 2025. However, domestic demand there has already peaked, forcing some smelters to temporarily halt operations amid weak prices.

Although any slowdown in Indonesian supply could lend some support, the sizeable global surplus remains intact. This means smelters would need to cut production for an extended period before prices see any meaningful improvement.

Nickel inventories on the London Metal Exchange have climbed by around 40,000 tons since the start of the year, reaching 195,000 tons, boosted by strong refining capacity from Chinese firms operating in Indonesia. Despite attempts to curb supply, overall sentiment in the market remains cautious, with any recovery dependent on a significant rebound in end-user demand.

Indonesia’s Nickel Market Faces Ongoing Surplus

Indonesia’s nickel sector continues to be under pressure, as government-set production quotas have outpaced actual demand, reinforcing the supply glut. Prices of nickel ore used in pyrometallurgy have fallen, while ore used in hydrometallurgy has held steady. High-grade nickel pig iron prices also remained stable, but smelter profit margins stayed tight. Policymakers are considering interventions, yet abundant supply and weak demand are likely to limit any near-term price upside.

Chinese Nickel Market Holds Firm Despite Surplus

In China, nickel and stainless steel markets showed some resilience, even as overall demand stayed soft and supply remained abundant. Government efforts to curb excess industrial capacity, along with expected seasonal changes in Philippine mining, could influence supply and pricing trends in the coming months.

Outlook

Markets are closely monitoring US interest rate policy, Chinese stimulus measures, and seasonal shifts in Indonesian supply as potential catalysts for nickel prices going forward.

Meanwhile, the US Dollar Index rose by 0.3% to 98.5 points at 15:07 GMT, hitting an intraday high of 98.5 and a low of 98.1.

In spot trading, nickel contracts slipped by 0.3% to $14,800 per ton as of 15:18 GMT.

Bitcoin maintained trading above the $113,600 level as traders awaited Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole Economic Symposium on Friday, an event that could set the market’s course heading into the fall.

The world’s largest cryptocurrency by market value rose about 1% on Thursday, recovering from a two-day decline earlier in the week. However, Bitcoin remains far below its record high of more than $124,000 set on August 14.

Ethereum (ETH-USD), the second-largest cryptocurrency, also posted gains of nearly 3%. Solana (SOL-USD) and Dogecoin (DOGE-GBP) led the rally among major tokens, jumping 4%, while Ripple (XRP-USD) and Tron (TRX-USD) moved more cautiously, rising 1.1% and 1.5%, respectively.

Investors will evaluate Powell’s speech at Jackson Hole as a potential market-moving event. The annual symposium, hosted by the Federal Reserve Bank of Kansas City in Wyoming, brings together central bankers, policymakers, and economists to discuss long-term challenges facing the global economy.

Markets often react sharply to every word spoken by the Fed chair at this event, as any signal of a more hawkish or dovish stance can ripple across currencies, bonds, equities, and cryptocurrencies.

For Bitcoin, a hawkish message underscoring inflation risks could pressure risk assets, potentially dragging the token back toward $110,000. A more dovish tone could revive hopes for a September rate cut, providing support for digital assets.

Although the causal link is not always direct, past Jackson Hole speeches that surprised markets have been followed by sharp moves across asset classes, making this year’s gathering closely watched by crypto traders.

Expectations for Two Rate Cuts Before Year-End

Rate traders are now pricing in two Federal Reserve rate cuts by the end of 2025, with the CME FedWatch tool signaling a 25-basis-point cut in September followed by another in December.

On the positive side, optimism remains that monetary easing will eventually arrive, while strong demand for spot Bitcoin exchange-traded funds (ETFs) continues to attract institutional inflows.

On the negative side, ongoing macro uncertainty and a strong US dollar ahead of Powell’s remarks could trigger another wave of liquidations if Bitcoin falls below $110,000.

Developments in Asset Tokenization

Beyond short-term trading dynamics, the digital asset sector is closely monitoring a major development in “asset tokenization.” SkyBridge Capital, founded by Anthony Scaramucci, announced plans to tokenize two of its hedge funds—Digital Macro Master Fund Ltd and Legion Strategies Ltd—in a move that could make investment products once reserved for the elite accessible to a broader audience.

The concept of tokenization refers to the process of converting ownership rights in assets—ranging from real estate and commodities to stocks and funds—into digital tokens recorded on the blockchain. This makes assets more liquid, easily divisible, and potentially accessible to a wider range of investors.

Ben Elvidge, Head of Commercial Applications at Trilitech and Product Director at Uranium.io, said: “SkyBridge’s move to tokenize $300 million worth of hedge funds represents a landmark in the evolution of tokenization. Wrapping multi-asset, complex strategies into on-chain instruments makes these exclusive funds more liquid and accessible.”

Elvidge added that institutional interest in tokenization is accelerating. Research from Trilitech shows that 90% of institutions are now familiar with the concept, and around 80% are either trading or planning to trade tokenized real-world assets. US firms, in particular, are showing strong demand, with 72% exploring the potential for tokenized commodities.

Oil prices rose by 1% on Thursday, supported by signs of strong demand in the United States, while uncertainty surrounding efforts to end the war in Ukraine added further support to the market.

Brent futures climbed 64 cents, or nearly 1%, to $67.48 a barrel by 10:12 GMT, near a two-week high. US West Texas Intermediate (WTI) futures also rose 65 cents, or 1%, to $63.36 a barrel. Both contracts had gained more than 1% in the previous session.

Russia said on Wednesday that attempts to resolve security issues linked to the war in Ukraine without Moscow’s participation represented a “dead end.”

Independent analyst Gaurav Sharma said: “If the White House does succeed in halting hostilities in Ukraine and Russia gradually returns to the international stage, that would be a bearish factor for oil. But for now, the $65 per barrel level remains a floor for Brent prices to watch.”

Meanwhile, US President Donald Trump announced an additional 25% tariff on Indian goods starting August 27, citing India’s purchases of Russian crude, which account for about 35% of its total oil imports. Russian officials in New Delhi said on Wednesday that Moscow expected to continue supplying India with oil despite US warnings.

With uncertainty lingering over progress toward ending the war in Ukraine, the prospect of tougher sanctions on Russia reemerged, reinforcing bullish sentiment among traders, according to Thomas Varga, analyst at PVM Oil Associates.

At the same time, data from the US Energy Information Administration on Wednesday showed crude inventories fell by 6 million barrels last week to 420.7 million barrels, compared with expectations in a Reuters poll for a 1.8 million-barrel decline.

Ashley Kelty of Panmure Liberum noted that the sharp drawdown in inventories indicated stronger demand, but rising crude levels at the Cushing hub suggested actual demand might be weaker, with the larger-than-expected draw partly driven by higher refinery runs and increased exports.

The US dollar fell on Thursday as investors awaited monetary policy signals from the Federal Reserve’s Jackson Hole symposium, while concerns over central bank independence resurfaced following the latest attack from President Donald Trump.

The euro and the pound steadied at $1.1652 and $1.3451 respectively, while the yen and the Swiss franc posted minor losses.

Odds of a Fed rate cut next month eased slightly to 82%, offering limited support to the dollar. Focus remained on whether Chair Jerome Powell would counter market expectations for a September cut in his speech on Friday.

Kenneth Broux, head of corporate FX and rates research at Société Générale, said: “The risks are skewed. Because the market has already priced in a cut, the danger is reverting back to a 50-50 scenario.” He noted this could trigger selling in short-dated Treasuries and push the dollar higher.

Meanwhile, Trump’s call for Fed Governor Lisa Cook to resign — based on allegations from a political ally — revived investor worries over his attempts to influence the central bank. Trump has repeatedly criticized Powell for being “too slow” to cut rates, and urged his resignation, while admitting that the Fed’s unique legal structure prevents firing board members over policy disputes.

Prashant Newnaha, senior APAC rates strategist at TD Securities, said: “These developments could raise questions about the Fed’s supervisory and regulatory functions, but they carry almost no immediate impact on monetary policy.” He added this explained the relatively calm FX reaction, as the dollar initially slipped before trimming losses and moving higher.

Investors expect Trump to replace Powell, whose term ends in May, with a more dovish candidate. Earlier this month, Trump announced he would nominate Council of Economic Advisers chair Steven Miran to fill a vacant Fed seat after Adriana Kugler’s surprise resignation.

The dollar index rose 0.1% to 98.337, set for a 0.4% weekly gain. The 10-year Treasury yield inched up to 4.30%, while the 2-year yield, more sensitive to policy, edged higher to 3.756%.

Some analysts cautioned markets may be disappointed by Powell’s speech on Friday, highlighting lingering uncertainty over the inflationary impact of Trump’s tariffs.

Elsewhere, Norway’s krone rose 0.4% versus the dollar and 0.5% versus the euro after stronger-than-expected non-oil GDP growth in Q2, alongside an upward revision to Q1 data.

In China, investor bets against the yuan climbed to their highest since mid-May, fueled by rising economic concerns, according to a Reuters survey released Thursday.

In crypto markets, Bitcoin slipped 0.6% to $113,741, while Ether dropped 1.6% to $4,285.89.