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The FOMC voted 12-0 in favor of a 25-basis point rate hike, sending US stock markets lower Wednesday afternoon.
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As expected, the US president's feathers were ruffled as he wants interest rates at 0%, so he turned his anger on Canada and the EU overnight through early Thursday morning.
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The Grains sector was mostly higher to start the day, albeit quietly, as rains continue to move across the US Midwest.
Morning Summary: A couple things went through my mind while watching Fed Chairman Warsh announce a 25-basis point rate hike Wednesday afternoon. What stood out to me was the vote went 12-0 in favor of the first hike in three years, despite the dictate from on high that rates come down. And while this agreed with what most in the industry were saying ahead of the announcement, it did not fit with what the Fed fund futures forward curve had been showing since the end of the July meeting. Recall the curve indicated the first cut would be in October, another in December, with no meeting in November. I wondered what I missed, so I looked at the charts again and still saw the same thing. The second thing that came to mind was the US president’s feathers were ruffled by his puppet not doing what he was told. There were two possible outcomes Wednesday afternoon through Thursday morning: 1) The US president would say the only line he is known for, “You’re fired”, to Mr. Warsh or 2) the US president would take out his anger by needlessly increasing the bombing on Iran or attack some other country. As it looks Thursday morning, the latter seems to have played out as he vents his ire at Canada for seeking a stronger trade alliance with the EU.
