Trade Policy Hearings in House, Senate This Week

Posted on 06/16/2019 6:44 AM

Trudeau comes to White House | FY 2020 Ag appropriations in House | FOMC

 


U.S. trade policy takes center stage this week with hearings in the Senate (Tuesday) and House (Wednesday) detailing the Trump administration’s trade agenda for the year. The sessions with USTR Bob Lighthizer will include updates on pending discussions with China, Mexico, Japan and the EU, along with updates on the push to ratify the USMCA. Meanwhile, President Trump will host Canadian Prime Minister Trudeau on Thursday when they will talk about the USMCA and China issues ahead of the G20 summit June 28-29 in Osaka, Japan.
     On the economic front, the Federal Open Market Committee (FOMC) will issue its decision Wednesday on interest rates. While no change is expected, traders will focus on the statement, updated Fed forecasts and a press event by Fed Chairman Jerome “Jay” Powell.
     In Congress, the Senate will again focus on nominations and later in the week will markup a border funding measure. The House will continue work on a four-bill spending package, include USDA & FDA.

 

 

U.S. trade policy and ongoing trade negotiations with several countries and the push to ratify the U.S.-Mexico-Canada Agreement (USMCA) will be the key topic for Congress this week on the policy front. Key events on tap include:

 

     On Monday, USTR holds a public hearing on President Donald Trump’s proposed tariffs on $300 billion more in Chinese goods.

 

     On Tuesday, U.S. Trade Representative Robert Lighthizer will update the Senate Finance panel on pending trade policy negotiations with China and others, and will also focus on getting the USMCA (NAFTA 2.0) ratified. He will also likely be asked to comment on a 90-day suspension for the Trump administration putting new tariffs on Mexico, depending on how pledged changes go relative to migration issues.

 

     On Wednesday, the House Ways and Means Committee hearing will review the U.S. 2019 trade policy, specifically on negotiations with China, Japan, the EU, and U.K.; the new USMCA trade deal and U.S. participation in the WTO.

 

     On Thursday, President Trump hosts Canadian Prime Minister Justin Trudeau; the two leaders will discuss ratification of USMCA, the replacement for the North American Free Trade Agreement (NAFTA).

 

The House will continue work on a four-bill spending package, HR 2740, and will start on a second package of spending bills covering Agriculture-FDA, Commerce-Justice-Science, Interior-Environment, Military Construction-VA and Transportation-HUD, HR 3055.

 

     The House also may consider border funding to deal with the crisis at the southern border.

 

     House Ways and Means Committee Chairman Richard Neal (D-Mass.) continues to consider paying for an expansion of the earned income tax credit and child tax credit with a 1 percentage point increase in the corporate tax rate. Even if approved, this topic will not be taken up in the Senate.

 

The Senate will consider more of Trump’s nominees and also plans to take up a $750 billion defense authorization bill, S 1215.

 

     Border and migrant funding. Majority Leader Mitch McConnell (R-Ky.) said the Senate will soon move forward on a funding bill to address the migrant emergency at the southern border. On Wednesday, the Senate Appropriations Committee holds a markup of emergency a supplemental border-funding package — $4.5 billion of the package would include money for the humanitarian care of migrant families crossing the border and to increase detention beds and personnel.

 

Economic updates for the week include:

 

Monday:
     — National Association of Home Builders releases the NAHB/ Wells Fargo Housing Market Index for June. Economists forecast a 66 reading, equal to May’s. The reading indicates that builders are bullish on the housing market.
     — Federal Reserve Bank of New York releases its Empire State Manufacturing Survey for June. Consensus estimates are for a 11 reading, down from May’s 17.8.
     — Treasury International Capital

 

Tuesday:
     — Census Bureau reports data on new residential construction for May. Expectations are for 1.25 million housing starts at a seasonally adjusted rate. Building permits are seen coming in at 1.3 million. Both figures would be about even with April’s data.
     — FOMC meeting begins


Wednesday:
     — FOMC announces its monetary-policy decision. The futures market predicts a one in four chance the Fed will cut the federal-funds rate by a quarter of a percentage point, to 2%-2.25%. Also: FOMC Forecasts and Fed Chair Press Conference
     — MBA Mortgage Applications

Thursday:
     — Conference Board releases its Leading Economic Index for May. Expectations are for a 112 reading, roughly even with April’s.
     — Department of Labor reports initial jobless claims for the week ending June 15. The four-week moving average for claims was  217,750.
     — Philadelphia Fed Business Outlook Survey
     — Current Account
     — Fed Balance Sheet
     — Money Supply
     — Bank of England and the Bank of Japan announce their monetary-policy decisions. Both central banks are expected to keep their key short-term rates unchanged at 0.75% and minus 0.1%, respectively.

Friday:
     — National Association of Realtors reports existing-home sales data for May. Consensus estimates are for a seasonally adjusted annual rate of 5.3 million home sales, up from April’s 5.2 million.

     — IHS Markit reports its Composite Purchasing Managers’ Index for June. Economists forecast a 51.1 reading, in line with May’s data.

 

Fed speakers on tap:

 

Friday:
     — Federal Reserve Member of the Board of Governors Lael Brainard will participate with Cleveland Federal Reserve Bank President Loretta Mester in a discussion on community development and the economy at the Cleveland Federal Reserve 2019 Policy Summit in Cincinnati, Ohio.

 

Key U.S. and international ag and energy reports and events include:

 

Monday, June 17

Ag reports and events:

  • Export Inspections
  • Crop Progress
  • Fruit and Tree Nut Data
  • Vegetables and Pulses Data
  • Livestock, Dairy, and Poultry Outlook
  • Sugar Outlook
  • EU weekly grain, oilseed import and export data
  • SGS data on Malaysia’s June 1-15 palm oil exports
  • Meeting of Brazil’s grain and cotton exporters to announce crop estimates
  • EU’s monthly MARS bulletin

Energy reports and events:

  • Day one of Unica’s ethanol conference in Sao Paulo
  • EIA monthly Drilling Productivity Report, with estimates for July prod. in U.S. basins

Tuesday, June 18

Ag reports and events:

  • Milk Production
  • Noncitrus Fruits and Nuts, Annual
  • ABARES Commodities Report
  • Day two of Unica’s ethanol conference in Sao Paulo

Energy reports and events:

  • J.P. Morgan Energy Conference kicks off in New York. Concho Resources, Exxon Mobil, and Phillips 66 are some of the firms expected to present.
  • API weekly U.S. oil inventory report

Wednesday, June 19

Ag reports and events:

  • Broiler Hatchery
  • Agricultural Land Values Final Estimates

Energy reports and events:

  • API issues weekly U.S. oil inventory report
  • EIA weekly U.S. oil inventory report
  • U.S. weekly ethanol inventories

Thursday, June 20

Ag reports and events:

  • Weekly Export Sales
  • Livestock Slaughter
  • Merck and Tyson Foods hold investor days in New York
  • ABARES Commodities Report
  • Intertek, AmSpec release Malaysia's June 1-20 palm exports data
  • China International Cotton Conference on textile exports, cotton policy
  • Holiday in Brazil

Energy reports and events:

  • EIA natural gas storage change

Friday, June 21

Ag reports and events:

  • CFTC weekly commitments of traders report on various U.S. futures and options contracts (back data)
  • Peanut Prices
  • Cost-of-Production Forecast
  • Cattle on Feed
  • Chickens and Eggs
  • Cold Storage
  • Argentina monthly crop report
  • FranceAgriMer weekly update on French crop conditions

Energy reports and events:

  • Baker Hughes weekly U.S. oil/gas rig counts

 

Other reports and events this week include:

 

Monday, June 17

  • Vice President Mike Pence and Sec. of State Mike Pompeo meet with Italian Deputy Premier Matteo Salvini, who is visiting Washington, Ansa reports
  • SEC holds closed meeting to consider institution and settlement of administrative proceedings.
  • China tariffs. USTR holds public hearing on Trump’s proposed tariffs on $300 billion more in Chinese goods.

Tuesday, June 18

  • President Trump formally kicks off his 2020 campaign in Florida; event at the 20,000-seat Amway Center in Orlando, along with first lady Melania, Vice President Mike Pence and second lady Karen Pence.
  • Trump trade policy. U.S. Trade Representative Robert Lighthizer testifies at Senate Finance Committee hearing on trade policy, USMCA.
  • TERP reauthorization. Senate Banking Committee hearing to examine the reauthorization of the Terrorism Risk Insurance Program (TERP).
  • Border funding. Senate Appropriations Committee markup of emergency supplemental border-funding package.
  • Health-care costs. Senate HELP Committee hearing on the “Lower Health-Care Costs Act of 2019” from Chairman Lamar Alexander and ranking member Patty Murray.
  • Ukraine. Kurt Volker, special representative for Ukraine negotiations, testifies at Senate Foreign Relations subcommittee hearing on “Ukraine’s progress” and “Russia’s malign activities” five years after Crimea was annexed by Russia.

Wednesday, June 19

  • Trump will give economist Arthur Laffer the Presidential Medal of Freedom, bestowing the nation’s highest civilian honor on the conservative academic synonymous with supply-side economics.
  • 2019 trade policy. House Ways and Means Committee hearing to review the U.S. 2019 trade policy, specifically on negotiations with China, Japan, the EU, and U.K.; the new USMCA trade deal and U.S. participation in the WTO.
  • Security law violator enforcement. House Financial Services subcommittee hearing examining proposals to strengthen enforcement against securities law violators.
  • Border funding. Senate Appropriations Committee markup of emergency supplemental border-funding package.
  • U.S. military and defense strategy. Gen. Joseph Dunford, chairman of Joint Chiefs of Staff, discusses U.S. military and defense strategy in conflict areas around the world and the current state of cooperative efforts with U.S. allies, at Council on Foreign Relations forum.
  • Fed rate decision. Also, Chairman Jerome Powell holds press conference. Economists expect the Federal Reserve to keep interest rates on hold while clearing a path for a cut if needed.  
  • Boeing 737 MAX hearing with Chesley “Sully" Sullenberger and Randy Babbitt, former FAA administrator; House Transportation subcommittee hearing.
  • Prescription drug costs. Vicki Robinson, HHS senior counselor for policy, is among witnesses at Senate Aging Committee hearing on efforts to further competition and increase affordability in the prescription drug market.
  • Opioids. House Oversight Committee examines the “inadequate federal approach” to opioid treatment and the need to expand care.
  • Nominations. Senate Homeland Security Committee to consider nomination of Chad Wolf to be DHS undersecretary for strategy, policy and plans, and nomination of Jeffrey Byard to be Federal Emergency Management Agency administrator.
  • U.S. ambassador to United Nations. Senate Foreign Relations Committee considers nomination of Kelly Craft as U.S. ambassador to the U.N.  
  • Transportation. NHTSA Deputy Administrator Heidi King testifies at Senate Commerce Committee hearing on implementation of the Fixing America’s Surface Transportation Act, which expires at the end of FY 2020, and priorities for the Transportation Dept.

Thursday, June 20

  • Trump hosts Canadian Prime Minister Justin Trudeau; the two leaders will discuss ratification of USMCA, the replacement for the North American Free Trade Agreement (NAFTA).
  • U.S./Mexico border. Deputy U.S. Trade Representative C.J. Mahoney, Republican Sen. John Cornyn and Republican Rep. Will Hurd among speakers at Wilson Center’s “Building a Competitive U.S./Mexico Border Conference.”
  • Diversity. House Financial Services Committee hearing reviews proposals to increase the diversity of America’s boards.
  • U.S./Mexico border. House Homeland Security subcommittee hearing to examine Defense Dept’s deployment to the U.S.-Mexico border.
  • Easing of fuel regulations. House Energy subcommittee hearing to review the Trump administration’s easing of fuel economy and carbon dioxide requirements for autos.
  • Climate change.  Democratic Sen. Chris Coons and Republican Rep. Francis Rooney will explore bipartisan support for tackling climate change, including how to best use revenue from a carbon price, at a Brookings Institution event.
  • Mueller Report. House Judiciary Committee holds second in its series of Mueller Report hearings, entitled “Bipartisan Perspectives.”

 

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