Iron ore holds weekly gains on China fiscal policy

Iron ore futures in Singapore held a weekly advance as China’s central bank took more incremental action to push back against a slowdown in economic growth, potentially aiding demand in the world’s largest importer of the raw material.

The People’s Bank of China added 300 billion yuan ($43 billion) of one-year funding, in line with the government’s goal to support growth while avoiding more aggressive policy moves.

China’s steel market has steadied in the past month on a burst of construction activity and modest signs of improvement in manufacturing.

Iron ore should continue to trend lower in the medium term but a resurgence in Chinese steel margins and drop in inventory could support raw material prices,” UBS Group AG said in a report.