Written Commentary
Ag Market View for July 26.24
July 26, 2024
CURRENCY FUTURES
The U.S. dollar index is higher, supported by the stronger than anticipated National Federation of Independent Business small business optimism report.
Lower prices are likely for the U.S. dollar longer term.
Industrial production in Germany declined 0.7% month-over-month in November 2023, accelerating from a downwardly revised 0.3% drop in October and missing market expectations of 0.2% growth.
Unemployment fell unexpectedly in the euro zone in November. The unemployment rate was 6.4% over the month when economists had expected the rate to increase to 6.6%.
All household spending in Japan in November declined 2.9% on the year when down 2.3% was anticipated.
STOCK INDEX FUTURES
Stock index futures are lower as traders await economic data due later in the week, including the December CPI, the December PPI and the kick-off of the earnings season.
The December National Federation of Independent Business small business optimism index was 91.9 when 90.6 was expected.
The fundamentals and technicals remain supportive to stock index futures longer term despite recent talk of a potentially less dovish Federal Reserve in 2024.
INTEREST RATE MARKET FUTURES
The Treasury will auction three-year notes today.
Michael Barr of the Federal Reserve will speak at 11:00 central time.
Traders continue to believe the Fed will cut interest rates this year but not at the January meeting.
Financial futures markets are predicting there is a 5.0% probability that the Federal Open Market Committee will reduce its fed funds rate by 25 points at its January 31, 2024 policy meeting and a 95% probability of no change.
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