Iron ore futures dipped below CNY 700 per tonne on Tuesday, marking a three-week low after data showed a 6.9% drop in China’s steel production in May—the first decline since Beijing pledged to address industry overcapacity in March. The weaker output signaled softer demand for raw materials and weighed on market sentiment.
Investors also grew cautious ahead of the US Federal Reserve’s policy decision this week, with the central bank expected to keep rates unchanged. However, expectations for further rate cuts have diminished amid persistent trade uncertainty and inflationary pressures driven by rising oil prices. Geopolitical risks added to the cautious tone, after US President Donald Trump called for the full evacuation of Tehran amid continued Israeli airstrikes and left the G7 summit in Canada early to monitor developments in the Middle East.
