There is belief that the high cost of nickel would go away from the market. The current price of nickel is impacting the balance sheets of the company.
China is stocking this metal given the low price of the base metal today. China is getting most of its nickel from Russia since the Indonesia ban is still in place.
Till the excess capacity of this metal on Top 10 Binary Demo is soaked up this will affect the pricing pressure. All that needs to be watched now is the import made by China, the drawdown of the stocks and the processing build pace in Indonesia.
Investors should buy nickel if they want to bet on the demand inflation of stainless steel and on weak US dollar portfolio diversification for hedging. The demand for stainless steel also contributes to the price of nickel.
Nickel is used in tanks, bridges and buildings and many such applications. The nickel metal is used in many infrastructure projects as well. Weak US dollar hedge and inflation is the way in which one bets on a weak US dollar and higher inflation.
Since nickel is priced in the US dollars so the economy of America impacts the price of nickel. The interest rates are being kept low by the US Federal Reserve Bank and this has also keep the US dollar weak. This is being done so that the borrowing power of customers increases. This in turn is very advantageous for the price of metals like nickel.
When the dollar is weak then this could raise the concerns of inflation. It takes lots of energy to produce nickel and its supply is also limited. The nickel price will benefited from inflation fears.
Also for traders it is recommended to invest into nickel because the vast majority of their money is deposited into stocks. The investment into metals like nickel lets the investors diversify their portfolio and reduce their portfolio risks.
The traders who are looking to purchase nickel should think about purchasing nickel along with some other commodities. They could include other base metals like copper and zinc, precious metals like gold and silver as well as agricultural commodities. It is important that the trader buys a number of commodities and keeps them in their portfolio. This protects the investors from volatility caused because of any single commodity.
This also helps to add diversification in case you are only concentrated on bonds and stocks. The things that could increase the demand for nickel are the demand in china and the huge infrastructure projects that US is planning to undertake.