Iron ore futures climbed on Thursday, with the Dalian benchmark hitting a fresh seven-week high, while prices in Singapore rose for a seventh straight session, as China’s big banks cut deposit rates in a move seen as supportive of economic growth.

China’s state-backed banks lowered the rates on yuan deposits in actions that could ease pressure on profit margins and reduce lending costs, providing some relief for the financial sector and wider economy.

Analysts say the move opens the door for further monetary stimulus, including a cut in the reserve requirement ratio to support local government bond issuances.

The most-traded September iron ore on China’s Dalian Commodity Exchange DCIOcv1ended daytime trading 2.7% higher at 791 yuan ($110.91) per metric ton. It earlier hit 793.50 yuan, its strongest since April 18.

On the Singapore Exchange, the steelmaking ingredient’s benchmark July contract SZZFN3 was up 1.5% at $109.50 per metric ton, as of 0700 GMT, off a session high of $109.90, its highest since April 21.

Iron ore has been mainly lifted by speculations since late May about steel producer China rolling out additional stimulus to reinvigorate its struggling property sector and wider economy, defying analyst warnings that gains might not be sustained without effective and broad measures.

China’s support measures for its property market will need “some time” to make an impact, state-run Economic Daily cautioned on Wednesday.

“The short-term market is affected more by macro expectations,” Sinosteel Futures analysts said, while pointing out that fundamentals have not really changed much.

Steel demand in China is expected to weaken during the summertime lull in domestic construction activity beginning this month.

Rebar on the Shanghai Futures Exchange SRBcv1 edged up 0.6%, hot-rolled coil SHHCcv1 gained 0.4%, wire rod SWRcv1 added 1.1%, while stainless steel SHSScv1 lost 0.2%.

Coking coal DJMcv1 on the Dalian exchange dropped 1.1%, while coke DCJcv1added 0.2%.

Source: Reuters