Monthly Industry Briefings > Monthly Industry Forecasts > Basic Metals

The Chinese government recently announced a mini-stimulus package which involves the bringing forward of a number of infrastructure initiatives, including metals-intensive projects such as the expansion of railways. The announcement certainly buoyed sentiment and steel prices. However, it is unlikely to result in an upgrade to our baseline forecast, since measures such as restricting credit to energy-intensive sectors will also take their toll on metals production demand. Indeed, crude steel output data for Q1 suggest a weaker start to the year than we have forecast. Crude steel data for the US and Japan ticked up in March after contracting for several consecutive months. Activity in Western Europe, however, continued to fall for the third successive month.