MANILA: Iron ore futures crept higher on Friday, stretching their gains for the week, as hopes grew that top buyer China would roll out more supportive policy measures for its economy at the annual National People’s Congress session next month.

Improved sentiment also lifted prices of steel and other steelmaking inputs in China, while Dalian iron ore scaled a contract high after trading range-bound in recent days.

The most-traded May iron ore on China’s Dalian Commodity Exchange rose as much as 2.1% to 890 yuan ($129.76) a tonne. It has gained more than 3% so far this year and is on track for a second consecutive weekly rise.

On the Singapore Exchange, the steelmaking ingredient’s benchmark March contract climbed 1.5% to $126.40 a tonne, its highest since Feb. 2.

Helping lift prices, China’s new home prices rose in January for the first time in a year, official data showed on Thursday, as the end of the country’s zero-COVID regime, favourable property policies and market expectations for more stimulus measures boosted demand.

With top steel producer China holding its annual National People’s Congress session in early March, hopes are high that Beijing will announce more economic stimulus measures.

Adding to the buoyant mood, China’s top leaders declared a “decisive victory” over COVID-19. Rebar on the Shanghai Futures Exchange rose 1.4%, hot-rolled coil gained 1.2%, wire rod added 0.4%, and stainless steel climbed 1.2%.

Coking coal and coke on the Dalian exchange rose 2.1% and 2.7%, respectively. Still, the outlook for China’s struggling real estate industry remains guarded. “Whilst the slight uptick (in new home prices) represents a major turning point, a rapid improvement is unexpected given the market remains flush with property from decades of overbuilding and investment demand is set to stay subdued,” SP Angel analysts said in a note.