Nickel prices fell on Wednesday amid a continued global supply surplus, despite the decline of the US dollar against most major currencies.

Nickel inventories on the London Metal Exchange remained within a limited range, rising by 1.5% to 212,232 tonnes, compared to 209,082 tonnes a week earlier.

This increase came despite the continued supply surplus in the market, as nickel inventories on the London Exchange have risen since the beginning of the year by about 40,000 tonnes to reach 195,000 tonnes, supported by strong refining capacity by Chinese companies in Indonesia. And despite attempts to curb supply, overall market sentiment remains cautious, with any recovery dependent on a significant improvement in final demand.

Indonesia’s nickel market faces continued surplus

Indonesia’s nickel market remains under pressure, as government-approved production quotas have exceeded actual production levels, which has boosted the supply surplus. Prices of nickel ore intended for pyrometallurgical smelting have declined, while prices of nickel ore used in hydrometallurgical smelting have remained stable.

Prices of high-grade ferronickel have also remained stable, but smelters’ profit margins have stayed narrow. Policymakers are considering possible interventions, but abundant supply and weak demand may limit price increases in the near term.

China’s nickel market remains resilient despite the surplus

Nickel and stainless steel markets in China have shown signs of resilience, despite weak overall demand and continued oversupply. The government’s policy to reduce industrial overcapacity, along with expected seasonal changes in Philippine mining, may influence supply and price trends in the coming months.

Outlook

Nickel prices recorded slight gains last week, but remained constrained by the global supply surplus, especially from Indonesia, and by cautious demand prospects. The market is monitoring US interest rate policy, Chinese stimulus measures, and seasonal changes in Indonesian supply as potential factors for any shift in nickel price momentum in the future.

On the other hand, the US dollar index fell by 0.4% to 97.7 points as of 16:44 GMT, recording a high of 98.1 points and a low of 97.6 points.

In US session trading, spot nickel fell by 0.8% to $15,100 per tonne at 16:55 GMT.

Bitcoin prices saw a modest rise on Wednesday, while Ethereum approached record highs, as the cryptocurrency market rebounded on the back of softer US consumer inflation data, which boosted bets on a September interest rate cut.

Altcoins outperformed Bitcoin on Tuesday and Wednesday, as growing risk appetite drove investors toward relatively lower-priced assets like Ether, which had lagged behind Bitcoin’s strong gains in recent months.

The world’s largest cryptocurrency rose 1.5% to $120,500 by 13:40 GMT.

Ethereum Nears All-Time High on Institutional Buying

Ethereum, the second-largest cryptocurrency, climbed to $4,680.23 this week, nearing its November 2021 record of $4,868.8. The rally was fueled largely by increased institutional and corporate buying in recent weeks, with major entities adopting strategies similar to that of MicroStrategy (NASDAQ:MSTR), the largest corporate holder of Bitcoin.

Bitmain Emergent Technologies (NYSE:BMNR), the largest institutional holder of Ether, announced Monday it now holds over 1.15 million tokens worth about $4.9 billion. The firm also unveiled plans to raise an unprecedented $24.5 billion via a stock offering, aimed primarily at purchasing more Ethereum.

In another notable move, 180 Life Sciences Corp (NASDAQ:ATNF), currently restructuring under the name Ether Treasury ETHZilla, disclosed that billionaire Peter Thiel had acquired a 7.5% stake. The announcement on Tuesday sent the company’s stock soaring more than threefold. The firm also revealed it holds around $349 million worth of Ether—82,186 tokens—bought at an average price of $3,806.71 each.

SharpLink Gaming Ltd (NASDAQ:SBET) also completed a $400 million capital raise this week, stating the funds would be fully allocated to buying more Ethereum.

This growing institutional interest has driven Ether to outperform Bitcoin in 2025 so far, with a 39.4% gain versus Bitcoin’s 27.9%.

Altcoins Outpace Bitcoin as Rate Cut Bets Rise

Broader digital asset prices rose faster than Bitcoin on Wednesday, amid increased risk appetite supported by the tame US inflation figures, which bolstered expectations of a September Fed rate cut. The rally also coincided with record highs in other risk-sensitive markets, particularly equities.

Altcoins gained additional support from mounting expectations that companies and institutions will boost their holdings of other digital tokens. XRP, the third-largest cryptocurrency, rose 3.1% to $3.2401, Cardano jumped 8.9%, and Solana surged 13%.

How Institutional Moves Could Shape Bitcoin’s Future

The emergence of spot Bitcoin ETFs marks a significant shift in the market, opening the door to large-scale institutional capital inflows. Giants like BlackRock and Fidelity have ramped up their participation, with analysts noting that such liquidity not only fuels market optimism but also encourages traders to buy at higher price levels. Historically, Bitcoin has thrived in periods of strong institutional backing, acting as a powerful catalyst for price appreciation.

Macro Factors Driving Bitcoin Higher

As Bitcoin edges toward key price levels, broader macroeconomic factors are seen as pivotal in determining its path. Market speculation is centering on a potential Fed rate cut—an event that could spark a push to new record highs. Lower interest rates typically increase demand for high-yielding assets, putting Bitcoin in a favorable position.

The Critical $140K Level

Traders are now watching the psychological $140,000 mark closely, with technical indicators such as a bullish MACD crossover and strong RSI support reinforcing the bullish outlook. A breakout above this level could trigger a wave of FOMO (fear of missing out) among both retail and institutional investors, potentially driving prices sharply higher in a short span.

Oil prices fell on Wednesday after the International Energy Agency (IEA) signaled that supply would outpace demand this year, while investors looked ahead to Friday’s meeting between US President Donald Trump and Russian President Vladimir Putin.

Brent crude futures dropped 41 cents, or 0.6%, to $65.71 a barrel by 10:37 GMT, while US West Texas Intermediate (WTI) crude futures fell 50 cents, or 0.8%, to $62.67. Both benchmarks had closed lower on Tuesday.

Giovanni Staunovo, commodity analyst at UBS, said: “Last night’s API oil inventory report, combined with the IEA’s downbeat oil market outlook today, put pressure on prices.”

The IEA said Wednesday it had raised its forecast for oil supply growth this year but lowered its demand estimates due to weak fuel consumption in major economies.

By contrast, the OPEC+ alliance said in its monthly report on Tuesday that it had raised its forecast for global oil demand next year and lowered its supply growth estimates for the US and other non-OPEC producers, signaling a potential tightening in the market.

Independent energy analyst Gaurav Sharma commented: “If we take the average of the IEA and OPEC’s projections for oil demand growth in 2025, between the pessimistic and optimistic ends, the modest figure—just over one million barrels per day—can easily be met by current non-OPEC supply growth alone. So I don’t see a case for prices to rally in the near term.”

In the US, the world’s largest oil consumer, crude inventories rose by 1.52 million barrels last week, according to market sources citing Tuesday’s API data. Gasoline stocks fell, while distillate inventories posted a slight increase.

Analysts polled by Reuters expect today’s Energy Information Administration (EIA) report to show a 300,000-barrel drop in crude inventories last week.

Trump and Putin are set to meet in Alaska on Friday to discuss ending the Russia–Ukraine war, which has roiled oil markets since February 2022.

Staunovo added: “It’s hard to predict what Friday’s meeting might yield, especially if Europeans are not present in Alaska.”

While the Trump administration has sought to downplay expectations of major progress toward a ceasefire—describing the summit as a “listening session”—Ukraine and most European nations have stressed that lasting peace cannot be achieved without Ukraine at the negotiating table.

The US dollar fell to a two-week low on Wednesday after weak US inflation data boosted expectations that the Federal Reserve will cut interest rates next month, while attempts by President Donald Trump to expand his influence over US institutions added pressure on the currency.

The dollar index, which measures the performance of the US currency against a basket of rival currencies, dropped to 97.76, its lowest level since July 28, extending Tuesday’s 0.5% loss.

Data released on Tuesday showed that US consumer prices rose marginally in July, in line with expectations, while the impact of the broad tariffs imposed by Trump on goods prices has so far been limited.

Investors, anticipating an imminent rate cut, welcomed the data and priced in a 98% probability that the Fed will ease policy next month, according to LSEG data.

Francesco Pesole, a strategy analyst at ING, said: “The release of US CPI data was a negative event for the dollar.” He added: “A September rate cut remains strongly priced in.” He noted that while the acceleration in core inflation is not ideal, it is not concerning enough to outweigh the deterioration in the labor market.

Investor confidence in the dollar was further undermined by Trump’s recent attempts to influence the Fed’s independence, after White House spokesperson Karoline Leavitt said on Tuesday that the president is considering suing Federal Reserve Chair Jerome Powell over his handling of the central bank’s headquarters renovation in Washington.

Trump has long been at odds with Powell, repeatedly criticizing him for not cutting interest rates sooner. The US president also attacked Goldman Sachs CEO David Solomon, saying the bank was wrong in predicting that US tariffs would hurt the economy, and questioning whether Solomon is fit to lead the Wall Street institution.

In the currency markets, the dollar’s weakness helped lift both the euro and the British pound; the euro rose 0.3% to $1.1709, briefly hitting its highest level since July 28, while the pound climbed 0.4% to $1.3562, its highest level since July 24.

Data released on Tuesday showed the UK labor market weakened again, despite wage growth remaining strong, which explains the Bank of England’s caution in cutting interest rates.

The Australian dollar rose 0.35% to $0.6552, while the New Zealand dollar gained 0.5% to $0.5986. The Reserve Bank of Australia cut interest rates on Tuesday as expected and signaled that further easing may be needed to meet its inflation and employment goals amid a loss of economic momentum.

In cryptocurrency markets, Bitcoin stalled in its push toward a new record high, falling 0.34% to $119,809, while Ethereum climbed to its highest level in nearly four years at $4,679.

Gracy Lin, CEO of the Singapore branch of crypto exchange OKX, said: “Ethereum’s quiet breakout is driven by real-world adoption and capital confidence,” adding: “On our platform, Ethereum has overtaken Bitcoin to become the most traded asset over the past month.”