The Federal Reserve Is Expected To Cut Interest Rates, And Futures In The US Cotton Market Will Plummet

Last night, non farm data came out, and gold and Bitcoin broke new records!

In the early morning of this morning, US President Biden said at the election campaign in Philadelphia that the Federal Reserve is expected to cut interest rates. "I bet 'they will come down'," Biden said

On Friday, the US Bureau of Labor Statistics released data showing that the US non-agricultural employment population increased by 275000 in February, again higher than the expected 200000, higher than the average monthly growth of 230000 in the past 12 months. The US nonfarm unemployment rate unexpectedly rose to 3.9% in February, a new high since January 2022, higher than the market expectation of 3.7%, which was 3.7% before January.

In December 2023, the number of new non-agricultural employment will be reduced from 333000 to 290000; The number of employees in January 2024 will be significantly reduced from 353000 to 229000. After these amendments, the number of non-agricultural employment in these two months has been revised downward by 167000.

Some market comments said that although the employment growth in February exceeded the expected growth, the employment growth in the previous two months was significantly revised down, the wage growth slowed down in February, and the unemployment rate unexpectedly rose, suggesting that the Federal Reserve still needs to act cautiously, and may feel relieved to start cutting interest rates in the middle of the year.

At the closing of gold futures, COMEX April gold futures closed 0.94% higher at 2195.3 US dollars/ounce, rising for seven consecutive trading days and hitting a record closing high for six consecutive days. At the close of the US stock market, spot gold was above US $2170/ounce, up about 0.8% during the day. Gold rose by 4.75% in this cycle, the largest weekly increase since October 13, 2023, for three consecutive weeks.

In addition, at 23:30 last night, Bitcoin broke through 70000 US dollars, a record high, and has risen 65% since this year. However, half an hour later, Bitcoin fell back below $67000, more than $3000 at a higher level. The US stock market closed above US $68000, up more than 1% in the last 24 hours, up more than 9% in the last seven days, far less than the increase of more than 20% last week.

USDA monthly report was released, and American cotton fell sharply

At 1:00 this morning, the United States Department of Agriculture (USDA) released its latest monthly report. The monthly report maintains the soybean inventory, harvest, output and export expectations unchanged. It is estimated that the US soybean ending inventory is 315 million bushels, analysts expect 318.81 million bushels, and USDA previously expected 315 million bushels. The soybean harvest is expected to be 50.6 bushels/acre, while USDA previously estimated 50.6 bushels/acre. The soybean output is expected to be 4.165 billion bushels, while USDA previously estimated 4.165 billion bushels. Soybean exports are expected to be 1.72 billion bushels, analysts expect 1.71208 billion bushels, and USDA previously expected 1.72 billion bushels.

The USDA monthly report lowered its cotton inventory and output expectations and kept the export expectations unchanged: the US cotton ending inventory was expected to be 2.5 million bales, analysts expected 2.72 million bales, and USDA had expected 2.8 million bales. The cotton output is expected to be 12.10 million bales, analysts expected 12.35 million bales, and USDA had expected 12.43 million bales. It is expected that 12.3 million bales of cotton will be exported, while analysts expect 12.25 million bales, and USDA previously expected 12.3 million bales.

The monthly report of USDA estimated that the total ending inventory of American wheat was 673 million bushels, and analysts expected 657.77 million bushels. USDA had previously estimated 658 million bushels. It is estimated that the final inventory of US corn is 2.172 billion bushels, analysts expect 2.15481 billion bushels, and USDA previously expected 2.100 billion bushels.

After the USDA monthly report was released, American cotton futures fell by 4%, while American beans, American soybean meal and American wheat rose.