Written Commentary
STOCK INDEX FUTURES
Stock index futures are lower after hawkish comments from Federal Reserve officials.
The 9:00 central time May Richmond Federal Reserve manufacturing index is expected to be -6.
The Federal Reserve will release its Beige Book on the economy at 1:00. This book is produced approximately two weeks before the monetary policy meetings of the Federal Open Market Committee. On each occasion, a different Federal Reserve district bank compiles anecdotal evidence on economic conditions from each of the 12 Federal Reserve districts.
In spite of lower prices today, the longer term fundamentals and technicals remain supportive.
CURRENCY FUTURES
The U.S. dollar index Is higher due to prospects of a Federal Reserve that will be slow to pivot to accommodation.
The inflation rate in Germany is expected to increase 2.4% in May 2024, compared with the same month a year earlier, according to the Federal Statistical Office.
The GfK Consumer Climate Indicator for Germany improved to -20.9 heading into June 2024 from a marginally revised -24.0 in the previous period, beating market forecasts of -22.5. This was the highest reading since April 2022.
The consumer price index in Australia unexpectedly increased to a 5-month high in April at up 3.6% on a year-to-year basis, which was above predictions of 3.4% growth.
INTEREST RATE MARKET FUTURES
Futures are mixed to lower after comments from Federal Reserve officials.
Hawkish comments from Federal Reserve Bank of Minneapolis President Neel Kashkari prompted traders to reduce their expectations for Federal Reserve interest rate cuts.
Federal Reserve speakers are John Williams at 12:45 and Raphael Bostic at 6:00 PM.
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