Written Commentary
Global Ag News for Dec 8.23
December 8, 2023
STOCK INDEX FUTURES
Stock index futures are mixed with much of the trade evening up ahead of Federal Reserve Chair Powell’s speech at 8:15 central time. Powell will also speak tomorrow.
The 9:00 September wholesale inventories report is expected to be unchanged.
CURRENCY FUTURES
The U.S. dollar is higher after hawkish on balance comments earlier today from Federal Reserve Governor Lisa Cook.
Euro zone retail sales in September in the 20 countries sharing the euro fell 0.3% month-on-month and by 2.9% year-on-year. Economists had expected declines of 0.2% in the month and 3.1% from a year earlier.
Median consumer expectations for euro area inflation over the next 12 months increased sharply to 4.0% in September 2023, hitting the highest level since April, from 3.5% in August.
The Reuters Tankan sentiment index for manufacturers in Japan improved to +6 in November 2023 from +4 in October, showing improvement in business confidence for the first time since August.
INTEREST RATE MARKET FUTURES
Futures are mixed.
Earlier today Federal Reserve Governor Lisa Cook said worsening geopolitical tensions could trigger broad negative spillovers to global markets, including higher inflation.
The Treasury will auction 10-year notes.
The Treasury Department will be issuing a substantial amount of new debt to finance its borrowing needs with a series of three auctions beginning next Tuesday.
In addition to Fed Chair Powell, other Federal Reserve speakers today are John Williams at 12:40, Michael Barr at 1:00 and Philip Jefferson at 3:45.
This week some FOMC members left the door open to further rate hikes. However, these hawkish comments had minimal impact on financial futures markets.
Financial futures markets are predicting there is a 90% probability that the Federal Open Market Committee will keep its fed funds rate unchanged at its December 13 policy meeting, and there is a 10% probability of a 25 basis point increase.
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