How much will the Fed’s interest rate hike affect raw material prices?

Due to the influence of many factors, in the future, iron ore and other steel smelting raw materials across the country will face certain upward forces.
(To learn more about the impact of specific steel products, such as Cold Rolled Galvanized Steel Coil, you can feel free to contact us)
The first is that the Fed continues to raise interest rates to have an exchange rate impact. The U.S. Federal Reserve ended its two-day monetary policy meeting on July 26 and announced that it would raise the target range of the federal funds rate by 25 basis points to between 5.25% and 5.5%. The main factor for the Fed to continue to raise interest rates this time is still a relatively high inflation rate. The Federal Reserve stated in a statement issued on the day it announced the interest rate hike that the Federal Open Market Committee remains highly concerned about inflation risks, and that the Federal Reserve will continue to reduce its holdings of U.S. Treasury bonds and agency bonds in accordance with its previous plan, and is committed to reducing the inflation rate to the target level of 2%.
(If you want to know more about the industry news on Dx51d Z150 Galvanized Steel Coil, you can contact us at any time)
Since the beginning of last year, the Federal Reserve has tightened monetary policy significantly, but the full effect of the monetary tightening policy has not yet appeared. While U.S. inflation has slowed since the middle of last year, it remains well above the long-run target of 2%. Affected by various factors, it is expected that the US inflation rate will be difficult to return to the 2% target in a short period of time. Therefore, the possibility of continuing to raise interest rates within this year, that is, in September, cannot be ruled out. Because of the depreciation of the exchange rate of RMB against the US dollar, the import cost of iron ore and other smelting raw materials will be correspondingly increased in the second half of the year.
(If you want to get the price of specific steel products, such as Galvanized Steel Coil For Roofing Sheet, you can contact us for quotation at any time)

Secondly, the inventory level of raw materials for iron and steel smelting is not high at this stage. Affected by the slump in steel prices in the early stage, iron ore inventories at ports showed a downward trend.
It is expected that in the second half of the year, the market for iron and steel smelting raw materials such as iron ore will continue to fluctuate widely, while its price bottom will rise. Like steel products, June may also be the inflection point of the steel smelting raw material market for the whole year.