By Keith Brown DTN Cotton Contributing Analyst
March cotton was sharply higher Wednesday after positive interest rate comments from Fed Chairman Jerome Powell sent the Dow Jones scurrying 500 points higher, while rolling the U.S. dollar down. Essentially, Powell’s speech was interpreted to mean the Federal Reserve may not hike interest rates at their December meeting. Naturally, with the U.S. dollar spilling lower, cotton was able to have a triple-digit rally.
Also supporting the market were the few deliveries placed against spot December Wednesday morning. While Tuesday’s notices tallied some 400 contracts, Wednesday’s were a mere 18 contract tendered.
Thursday, USDA will issue its weekly sales and exports report at 8:30 a.m. eastern. This will be the last “official report” out on cotton until the G-20 meeting this weekend. It would be hugely insightful if China were to appear as an old crop buyer. At any rate, it has been stressed at nauseam about the importance of this weekend’s gathering. Still, it could be a market maker or breaker for cotton.
Spot December closed at 77.76 cents, up 0.99 cent, March closed at 78.88 cents, up 1.00 cent, December 2019 was at 77.05 cents, up 0.43 cent.
