Iron ore climbed on Tuesday after steep losses in the previous session, with markets waiting for fresh Chinese economic data for clues on the state of demand in the world’s top steel consumer.

Economic data in the coming weeks is expected to show the world’s second-largest economy got off to a good start in 2017, with steady growth giving the central bank room to slowly tighten monetary policy and contain the risks from high levels of debt. Trade data is due on Friday.

The ferrous sector has come under pressure since the country launched a surprise short-term rate hike last week, boosting financing costs for holders of commodities, which are priced in dollars. Steel prices slid more than 5 percent.

“We continue to feel that iron ore looks overbought and is due for a correction, especially as it looks more likely that China is interested in reining in things in given the short-term interest rate hike,” said INTL FCStone in a report.

China is expected to report on Tuesday that foreign exchange reserves fell for the seventh straight month in January but at a much slower pace as authorities tightened controls on capital outflows and the surging U.S. dollar lost some steam.

The most-active rebar on the Shanghai Futures Exchange climbed 2.2 percent to 3,165 yuan ($461) a tonne. In the previous session, it closed down 6.8 percent, its weakest since Jan. 10 at 3,062 yuan a tonne.

The dollar also edged up after Philadelphia Federal Reserve Bank President Patrick Harker on Monday said he would be open to raise interest rates again at the U.S. central bank’s March meeting if growth in jobs and wages continues.

Iron ore on the Dalian Commodity Exchange rallied 3.1 percent to 625 yuan ($91).

“Iron ore spot prices threatened to push below $80 a tonne after data showed another strong rise in inventories of iron ore held at Chinese ports,” ANZ said in a note. China’s iron ore stocks at ports hit a record high last week. SH-TOT-IRONINV

“Stocks rose by 3.3 percent, or 3.9 million tonnes, to 123.45 million tonnes last week. This should come as no surprise, with subdued demand around the holidays coming amidst strong growth in supply.”

Iron ore for delivery to China’s Qingdao port fell 3.3 percent on Monday, according to Metal Bulletin.

Source: Reuters (Reporting by Melanie Burton; Editing by Joseph Radford and Sherry Jacob-Phillips)