The Fed holds with three hawkish dissents and the dollar falls. An Iranian strike on Jordan lifts oil, and both shocks lift aluminium.美联储维持利率但三票鹰派异议,美元走弱;伊朗袭击约旦推升油价,两大冲击共同提振铝价。

1 · Market Performance

Data SHFE aluminum, most-traded AL2609, Wednesday July 29 confirmed day-session close

• AL2609 closed the July 29 day session at a confirmed 23,455 CNY/mt, +240 (+1.03%), on volume of 267,105 lots with open interest of 253,776 lots, up 2,341 (SMM caliber). That is 180 above the July 28 close of 23,275.
• A second consecutive session of rising price on rising open interest. Most-traded open interest gained more than 4,000 lots on July 28 and a further 2,341 on July 29 — over 6,000 lots added across two days with price moving up in step, the signature of new length rather than short covering (interpretation).
• Technical structure (SMM caliber, confirmed): 23,455 moved above the 5-day and 10-day moving averages but remains below the 60-day. SMM is explicit that despite the day’s strong rebound, the medium-term downtrend is intact and the 60-day average continues to cap the upside. Estimated levels: MA5 ~23,290, MA10 ~23,180, MA60 ~23,600. (Note: this differs from this brief’s earlier MA60 estimate; SMM’s own read governs here.)
• View A live snapshot at the time of writing showed the most-traded contract near 23,480 — if accurate, the July 29 night session extended modestly higher after both macro shocks. The snapshot is unconfirmed and carried for direction only.

Data LME 3-month aluminum, Wednesday July 29 confirmed close

• Confirmed close $3,178.60/mt, +0.95% (+$30.00; TradingEconomics caliber); an alternative vendor caliber prints $3,181.90 (+1.06%) — both carried, and they agree on direction.
• Up ~2.60% over the past month and ~+21.92% YoY (alternative caliber: +2.70% and +22.04%).
• Structure: the MA5 lost the previous day has been recovered. Estimated MA5 ~$3,163, MA10 ~$3,150, MA20 ~$3,165, MA30 ~$3,225, MA60 ~$3,360 — $3,178.60 is back above MA5/MA10/MA20 but still ~$46 below MA30. The $3,200 hard cap is within range for a fourth time but has not yet been tested.
• The rebound channel off the early-July four-month low of $3,085 remains intact. Support is MA5 (~$3,163), then MA10 (~$3,150) and $3,120; resistance is the $3,200 hard cap, then MA30 (~$3,225).

View Level assessment

• SHFE is back at the top of its July range (~22,900–23,500), with 23,455 only ~45 from the range high; but SMM’s explicit read that price remains below MA60 means this is strength within a range, not a confirmed trend reversal.
• LME sits mid-to-upper range, having recovered its short averages without reaching $3,200. What matters is the driver: this advance came from geopolitics and the dollar, not from new inventory or demand information — a completely different character from July 28’s inventory-led, strong-inside/weak-outside move.
• The two boards re-converged on the day (SHFE +1.03%, LME +0.95%), with the prior session’s divergence temporarily erased by the macro shocks. If the geopolitical premium bleeds off again, both boards will likely revert to pricing their own fundamentals (interpretation).

2 · Prices & Related Markets

Data/latest (SHFE, LME and China spot are all July 29 confirmed calibers)

• SMM A00 / Shanghai spot ingot: 23,400 CNY/mt, +200 (+0.86%) ↑ — tracking futures higher.
• Regional spot (July 29, SMM): Nanhai/Foshan 23,520 (+260) ↑↑ — the largest gain; Wuxi 23,390 (+200) ↑; Hangzhou 23,430 (+200) ↑; Chongqing 23,430 (+200) ↑. Foshan’s 60-yuan outperformance versus the national move is a clue about South China arrivals and just-in-time demand (interpretation).
• Spot premium/discount: futures rose 240 in a day while spot rose 200, so the discount structure passively widened by roughly 40 ; the prior session’s steady narrowing was interrupted by the rally (interpretation).
• LME aluminum: $3,178.60 (+0.95%) confirmed ↑ (alternative caliber $3,181.90, +1.06%).
• LME stocks: 271,275 mt (July 24), the lowest in records back to January 1998 ↓; on-warrant 245,350 mt — the caliber has not been updated; this remains the latest available print this week.
• China ingot inventory: 979 kt (July 27) ↓ — the first sub-1 Mt reading of the cycle, caliber not updated; 1,006 kt on July 23 and 1,022 kt on July 20.
• ADC12 (secondary alloy, July 29): national average 24,100 CNY/mt (range 24,000–24,200), +100 ↑; East, South, Southwest and Northeast China all 24,100 (+100). Japanese import $3,070 and general import CIF $3,100, both unchanged ↔. Other alloys: A380 26,000 (+100), AlSi9Cu3 25,000 (+100), A356 23,700 (+200), A360 24,000 (+200), ZLD102 23,500 (+200), ZLD104 23,600 (+200).
• Alumina (July 29): futures most-traded AO2609 closed 2,683 CNY/mt, +2 (+0.07%), on 188,688 lots with open interest of 255,044 — down a heavy 34,885 lots ↔; SMM alumina index 2,707.84 (−0.63) ↓; regional spot: Guizhou 2,780, Henan 2,760, Shanxi 2,750, Shandong 2,735, Guangxi 2,640. On the same day aluminum rose 1.03%, alumina managed +0.07% while funds exited heavily — the single most important non-confirmation of the session (interpretation).
• Crude (July 29, confirmed): Brent settled $90.74, +7.9% on the day ↑↑; WTI settled $84.46, +6.6% ↑↑ — one session erased the entire four-session decline, rebuilding the energy premium instantly.
• Dollar index: fell 0.49% to 100.92 on the FOMC decision (July 29) ↓; ~100.89 (+0.06%) into the July 30 morning, −0.50% over the past month and +0.92% over 12 months.

View

• The core price information today is a change of driver: July 28 was inventory-driven with the boards diverging; July 29 was geopolitics- and dollar-driven with the boards converging. The more exogenous the driver, the more the durability of the move depends on the event itself.
• A critical non-confirmation appeared on the cost side: aluminum +1.03% versus alumina +0.07% with 34,885 lots of open interest leaving. Smelter margins widened passively and the cost floor did not rise with metal. If alumina cannot follow even on a strong aluminum day, the advance looks closer to sentiment pricing than cost-push (interpretation).

3 · Inventory

Data/latest (calibers not updated; these are the latest available prints this week)

• China ingot: major-consumption-area electrolytic aluminum ingot inventory was 979 kt on July 27, the first sub-1 Mt reading of the cycle; 1,006 kt on July 23 and 1,022 kt on July 20 — draws of 16 kt and 27 kt across the last two prints. Cumulative drawdown from the early-May peak near 1.465 Mt is ~486 kt. July path: 1,022 (7/20) → 1,006 (7/23) → 979 (7/27).
• Three-region caliber: on July 27, Guangdong 207 kt, Wuxi 353 kt, Gongyi 233 kt — 793 kt combined, −14 kt vs the prior print.
• LME stocks: 271,275 mt (July 24) — the lowest in LME records back to January 1998, below August 2022’s 271,450 mt; on-warrant 245,350 mt; equal to less than one day of global consumption. July path: ~298,775 mt early July → 278,275 mt (July 22) → 271,275 mt (July 24).
• Billet: major-consumption-area social inventory 122 kt on July 27, versus 121 kt (July 23) and 120 kt (July 20) — a third consecutive week of buildup, small in size but unambiguous in direction.
• SHFE aluminum warrants: 395,143 mt on the July 10 weekly caliber, −11,871 mt (−2.92%) vs July 3. (Series lags; trend only.)
• Cast aluminum alloy warrants: total registered 17,341 mt on July 29, −148 mt d/d; Shanghai 1,506, Guangdong 1,697, Jiangsu 3,806, Zhejiang 6,483, Chongqing 3,064, Sichuan 785.

View

• No new inventory data today, but the structural read is unchanged: the floor is genuinely double-sided. China at 979 kt and the LME at 271,275 mt are both at cycle or multi-decade lows — together they underpin price; they do not by themselves drive it higher.
• The counter-detail that must be read alongside the ingot draw is billet: a third straight week of buildup (120 → 121 → 122 kt). Ingot destocking with billet building points to metal moving from ingot into billet but not from billet into end-use — the off-season blockage at the processing stage has not cleared (interpretation).
• Key tell: whether Thursday’s (July 30) SMM weekly ingot print extends below 979 kt. If it flattens or builds after a sharp futures rally, the physical basis of this advance weakens materially.

4 · Macro Factors

Data: FOMC, July 29 — a hold, but a 9–3 split

• The FOMC voted 9–3 to hold the federal funds target range at 3.50%–3.75%.
• All three dissenters favored a 25bp hike: Cleveland Fed President Beth Hammack, Minneapolis Fed President Neel Kashkari, and Dallas Fed President Lorie Logan. This is the first time since September 2016 that three officials dissented in the same direction, making it one of the most contested policy decisions in recent Fed history.
• This was the second decision of Chair Warsh’s tenure. Warsh has removed forward guidance from the post-meeting statement, arguing for giving markets fewer signals about the next move; he has previously called inflation “a choice” and made bringing prices down an explicit priority. There was no Summary of Economic Projections.
• Market reaction (confirmed): the dollar index fell 0.49% to 100.92. A live meeting had already been priced (FedWatch showed hike odds as high as ~34% pre-decision), so the market sold the fact once the hold landed (interpretation).
• September repriced sharply forward: fed funds futures now imply roughly an 80% probability of a September hike, with a move all but fully priced by year-end; CME FedWatch caliber: September hold 29.8%, cumulative +25bp 50.6%, cumulative +50bp 19.6% — both calibers point to a hike as the base case. Next meeting: September 16.

Data: geopolitics — the Hormuz lull broke

• Overnight July 28–29, Iran’s IRGC fired ballistic missiles at the Muwaffaq Salti Air Base and CENTCOM’s forward headquarters in Jordan, puncturing the multi-day pause in fighting. Jordan’s military said all missiles were intercepted, with five destroyed.
• US and Saudi aircraft struck multiple Iran-backed Shiite logistics and weapons sites in eastern Iraq, in response to alleged drone attacks on Saudi Arabia.
• Trump told Fox News that Iran is “going to get a beating” — while also saying talks with Iran will continue.
• Crude reaction (confirmed): Brent settled +7.9% at $90.74 and WTI +6.6% at $84.46. The Houthi “maritime embargo” declaration against Saudi Arabia and the reported Red Sea tanker attacks remain unresolved.

Latest: China

• The July 30 Politburo meeting is today’s domestic policy focus — by convention it analyzes the current economic situation, sets out H2 economic work, and takes up the 15th Five-Year Plan recommendations and Central Committee plenum arrangements. (Content was not published at the time of writing; carried as an event, with no prejudgment.)
• Backdrop: Q2 GDP +4.3% YoY (Q1 5.0%, H1 +4.7%), the weakest in nearly three years, with a “strong supply / weak demand, strong external / weak internal, strong new / weak old” structure; June exports +27% YoY, manufacturing PMI 50.3; property investment ~−18%; LPR unchanged (1Y 3.00% / 5Y 3.50%). Attention centers on incremental reserve policy and follow-through on curbing disorderly low-price competition among firms.

View: impact on aluminum

• Bullish: the dollar down 0.49% to 100.92 (a weaker numeraire lifts dollar metal directly); renewed escalation plus Brent +7.9% in a day — the Gulf accounted for ~9% of global aluminum consumption pre-war, and the outlook for Hormuz transit has deteriorated again, pushing back any restart of Gulf primary supply; higher energy raises ex-China smelting and freight costs; the double inventory floor (979 kt / 271,275 mt); two straight days of rising SHFE open interest on rising price.
• Bearish: three same-direction dissents and a September hike now ~80% priced — today’s dollar relief was bought with September tightening, which structurally limits how far the dollar can fall; Warsh’s removal of forward guidance systematically raises policy-path uncertainty and the market’s sensitivity to single data points; alumina managed only +0.07% on a day aluminum rose 1.03%, shedding 34,885 lots — the cost side refuses to confirm; the Indonesian and Chinese supply offset has not paused; a third straight week of billet buildup; Q2 GDP 4.3% and property −18%.
• Net: the bullish inputs are exogenous (war and the dollar); the bearish inputs are endogenous (September’s hike, the supply offset, and a cost side that will not follow). Exogenous shocks can arrive quickly and can leave just as quickly; structure does not change in a single session. That makes this a rebound rather than a reversal, unless alumina and physical turnover deliver confirmation.

5 · Fundamentals

Data/carried forward: ex-China regional premiums remain elevated

• Ex-China supply: damaged Gulf smelters have cumulatively stripped roughly 2 million tonnes from global supply (pre-war Gulf exports were ~9% of global aluminum consumption); the July 29 missile attack and air strikes push the timetable for restored Hormuz transit further out, weakening the case for Gulf metal returning (interpretation). Middle East gas shortages continue to lift operating costs at European and Asian smelters, and Brent’s 7.9% one-day jump raises ex-China smelting and freight costs directly.
• The supply offset (not paused — the structural explanation for the cap): Indonesia’s primary exports rose from 155 kt (2024) to 511 kt (2025) and a further +58% YoY in January–May 2026; up to 11 new smelters are planned with combined capacity near 13 Mt/yr; Hua Chin (480 kt/yr) has ramped and Alamtri Resources Indonesia shipped first exports in June; the Kaltara project plans to reach full phase-one capacity of 500 kt/yr by October 2026; Vietnam’s Dak Nong phase one (150 kt/yr) started in Q2 2026. Indonesia’s Inalum has called on the government to temporarily halt approvals for new alumina refinery and smelter projects, warning aluminum could follow nickel, where over-expansion drove prices down — a warning from the biggest beneficiary of expansion is itself confirmation of medium-term supply pressure, not a refutation of it (interpretation).
• Domestic supply: operating capacity ~45.31 Mt/yr (pressing the 45 Mt policy ceiling; installed ~46.1–46.3 Mt), utilization near 99%, liquid-aluminum share ~77.2%; May semis exports 595 kt, the highest since November 2024.
• Alumina: operating capacity ~96.2 Mt/yr at ~78% utilization, output growing ~8% and outpacing metal → the surplus persists; AO2609 closed 2,683 (+0.07%) on July 29 but open interest fell 34,885 lots on clear fund exit; SMM index 2,707.84 (−0.63); SMM is explicit that domestic oversupply and inventory buildup keep pressuring the market even as ex-China conditions tighten. On bauxite, Guinea’s export controls are the medium-term variable (the 150 Mt/yr ceiling under discussion would remove ~33 Mt/yr), and Indonesia faces its own bauxite deficit risk.
• Downstream: the high-temperature off-season continues; leading processor operating rate ~61.3%; SMM explicitly cites weak domestic demand alongside new ex-China capacity as the twin constraints on the rally; exports are the bright spot (June exports +27%, May semis 595 kt); PV, grid and auto steady; construction and property weak (property investment −18%); packaging steady; billet has built for a third straight week with processing fees still near the cost line.
• Spot sentiment: on July 29 futures rose 240 and spot followed with 200 — sellers were more willing to mark up than buyers were to accept; chasing the rally was broadly cautious, with downstream buyers restricted to just-in-time needs and the sidelines (interpretation).

View

• There was no new bullish fundamental today; what was new is that a bullish timetable got pushed back: the return of ~2 Mt of Gulf supply is further away after July 29’s escalation. That lifts the far end of the curve, not the near-term balance sheet.
• Meanwhile the offset side gained a confirmation from inside the industry: Inalum asking Jakarta to pause approvals. When the largest beneficiary of expansion starts warning about surplus, the credibility of medium-term supply pressure rises rather than falls.

6 · Primary Aluminum Spot Market

Data/latest (July 29, SMM caliber)

• Overall: a high-volume futures advance pulled spot up across the board, but by less than futures (spot +200 vs futures +240), passively widening the discount by roughly 40; sellers were more forward with offers while buyers were cautious about chasing.
• East China: Shanghai 23,400 (+200), Wuxi 23,390 (+200), Hangzhou 23,430 (+200). Physical-futures traders have an incentive to absorb metal as the discount widens, but fabricators facing the off-season plus higher prices stayed on just-in-time buying.
• South China: Nanhai/Foshan 23,520 (+260) — the largest gain nationally, 60 above the average, suggesting either localized tightness or slower arrivals; tax-invoice circulation remains a constraint.
• Southwest / other: Chongqing 23,430 (+200), tracking the national move.
• Secondary: ADC12 national average 24,100 (+100); Japanese import $3,070 and general CIF $3,100 both unchanged — the domestic market rose while import offers did not, narrowing the import window at the margin (interpretation); cast alloy registered warrants 17,341 mt, −148 mt d/d.

View

• The key physical reading today is “followed, but did not chase”: a nationwide 200-yuan gain that lagged futures by 40 says spot was pulled by futures rather than physical tightness pushing futures.
• Foshan’s 260-yuan outperformance is the one regional signal worth tracking on its own. If it converges back to the national average next session it was quote noise; if it holds, it points to a genuine marginal tightening in South China (interpretation).
• Test to apply: if the discount narrows again on July 30 with turnover picking up once futures stabilize, the advance has physical confirmation; if the discount keeps widening on thin turnover, this was funds and sentiment alone.

7 · Key Price Drivers

Bullish

• Renewed geopolitical escalation: IRGC ballistic missiles fired at the US air base and CENTCOM forward HQ in Jordan; US and Saudi strikes on eastern Iraq; Trump saying Iran is “going to get a beating.” The timetable for restored Hormuz transit and the return of ~2 Mt of Gulf supply has been pushed back again (the Gulf was ~9% of global aluminum consumption pre-war).
• Energy cost repricing: Brent +7.9% to a $90.74 settle and WTI +6.6% to $84.46, erasing four sessions of decline in one; raises ex-China smelting, alumina and freight costs.
• A weaker dollar: DXY −0.49% to 100.92 post-decision, a direct lift for dollar-denominated metal.
• A double inventory floor: China ingot 979 kt (July 27), the first sub-1 Mt print of the cycle; LME stocks 271,275 mt (July 24), the lowest since January 1998, on-warrant 245,350 mt, under one day of global consumption; cash holds a mild backwardation to 3M.
• Positioning confirmation: SHFE has now posted two consecutive sessions of rising price on rising open interest (+4,000-plus lots July 28, +2,341 to 253,776 July 29) on volume of 267,105 lots; LME recovered its MA5.
• Structural support: operating capacity ~45.31 Mt against the 45 Mt policy ceiling; a prospective H2 global deficit of ~930 kt; elevated ex-China premiums (Japan Q3 MJP ~$395, Europe ~$547.5, US Midwest ~110.5¢/lb); the July 30 Politburo meeting as an incremental-policy window.

Bearish

• A September hike is now ~80% priced: the FOMC held at 3.50–3.75% but split 9–3, with Hammack, Kashkari and Logan all dissenting for a hike — the first three same-direction dissents since September 2016; CME FedWatch puts a September hold at just 29.8%. Today’s dollar decline was purchased with September tightening, which structurally caps further dollar downside.
• Policy-path uncertainty has risen systematically: Warsh has removed forward guidance and there was no SEP, leaving the market without an anchor and amplifying the impact of individual data prints.
• The cost side refuses to confirm: on a day aluminum rose 1.03%, AO2609 gained only 0.07% to 2,683 while shedding 34,885 lots of open interest; SMM index 2,707.84 (−0.63); domestic alumina surplus and inventory buildup keep pressuring the market — smelter margins widened passively and the cost floor did not follow metal higher.
• The supply offset has not paused: Indonesian primary exports +58% YoY in Jan–May, 11 planned smelters at ~13 Mt/yr (Hua Chin 480 kt ramped, Kaltara phase-one 500 kt targeted for October, Vietnam’s Dak Nong 150 kt); China at ~99% utilization with May semis exports of 595 kt. This is the structural reason $3,200 has failed three times, and nothing about July 29’s escalation changed it.
• Demand and physical: the high-temperature off-season, leading processor operating rate ~61.3%; a third straight week of billet buildup (120 → 121 → 122 kt); spot rose less than futures, passively widening the discount by ~40 with buyers cautious about chasing; Q2 GDP +4.3%, the weakest in three years, and property investment −18%.

8 · One-Sentence Market View

9 · Watchlist for Today’s Day and Night Sessions

1. The next step in the escalation (today’s biggest variable): the form and scale of the US response to the IRGC missile attack, and whether it reaches Iranian energy or port infrastructure; Hormuz transit status; whether Brent can hold $90 — if crude gives the move back, half the driver of this aluminum advance disappears with it.
2. SHFE AL2609 (Wednesday confirmed 23,455): whether the night session holds 23,400 and tests 23,500; the tell is open interest — after two days of builds, a rally on falling open interest would signal long liquidation ahead; MA60 (~23,600) is the medium-term cap SMM has explicitly flagged.
3. LME 3M (Wednesday confirmed $3,178.60): whether it approaches and tests the $3,200 hard cap for a fourth time; a loss of MA5 (~$3,163) puts MA10 (~$3,150) and $3,120 back in play. Breaking $3,200 remains the only clean measure of whether the geopolitical premium has finally overpowered the Indonesian supply offset.
4. The dollar index (100.92 → ~100.89 into the morning): whether the post-decision decline extends or reverses as September hike pricing (~80%) reasserts itself; note that with forward guidance removed, the dollar’s sensitivity to individual data prints is higher.
5. Thursday’s (July 30) SMM weekly ingot inventory: whether it extends below 979 kt; a flat or building print after a sharp futures rally would materially weaken the physical basis of this advance; watch also for a fourth week of billet buildup.
6. Confirmation from alumina: whether AO2609 can recover and hold 2,700, and whether July 29’s 34,885-lot position exit continues. If aluminum keeps rising while alumina stays weak, expanding smelter margins reinforce the medium-term supply-release case.
7. Spot discounts and turnover (the most sensitive falsification test): July 29’s 200-yuan spot gain lagged futures by 40 and passively widened the discount; whether the discount narrows again alongside a pickup in turnover — narrowing on volume confirms the rally, widening on thin trade marks it as pure sentiment; and whether Foshan’s 260-yuan outperformance persists.
8. The July 30 Politburo meeting: the tone set for H2 economic work, incremental reserve policy, and the language on curbing disorderly low-price competition among firms; the marginal implications for domestic demand expectations and smelting capacity policy.