Nickel prices rise 2%, approaching $25 thousand a tone

Nickel prices rose on Wednesday as the dollar fell against most major rivals amid ongoing positive outlook for Chinese demand for commodities and minerals.

Chinese Demand

Markets remain hopeful for a rebound in Chinese economic recovery after lifting Covid 19 restrictions and opening up the economy once more.

China is the world's largest consumer of industrial metals and their prices are highly sensitive to Chinese developments. 

Nickel was also boosted today by a weaker dollar, which makes dollar-denominated commodities cheaper to holders of other currencies. 

Rate Decision 

The Federal Reserve is wrapping up its policy meeting today, expected to raise interest rates by 25 basis points to 5.25%, the highest since 2007.

The Fed will also provide clues on the future steps of policies by the bank, and whether this rate hike is indeed the latest this year.

The Fed recently maintained interest rate targets at 5.25% in 2023 unchanged, indicating a single additional rate hike in May.

Nickel is used rather extensive in the steel and automotive industries for manufacturing electric cars, crucial for environmental efforts to reduce CO2 emissions. 

Otherwise, the dollar index fell 0.5% as of 15:37 GMT to 101.4, with a session-high at 101.9, and a low at 101.4.

Nickel spot prices rose 2.1% to $24.7 thousand a tone as of 15:48 GMT.