Goldman raises aluminum forecasts on high Chinese and European demand

Analysts, including Nicholas Snowdon and Aditi Rai, said in a note to customers that the metal will be average of $3,125 per tonne in London this year. That's higher than the current price of $2,595 and compares to the bank's previous estimate of $2,563.

Analysts said, "With apparent global inventories down 900,000 tons compared with a year ago and currently at 1.4 million tons, the lowest level since 2002, the return of the total deficit will quickly trigger scarcity concerns. With dollar headwinds and a slowing Fed walk cycle, against a much more benign macro environment, we expect upward price momentum to develop gradually near to the spring.” said.

Aluminum reached record levels just after Russia invaded Ukraine last February. Since that time, it has declined because of the energy crisis in Europe and the slowing global economy have caused many smeltery to cut production.