Trump Sends Pelosi Revised USMCA for Review; More Talks This Week

Posted on 12/08/2019 6:04 AM

House labor bill | WASDE on Tuesday | DOJ watchdog report | FOMC announcement

Lawmakers are “rushing” to get a few must-have topics done that they have had all or most of the year to do. This includes fiscal year 2020 spending, a vote on the U.S.-Mexico-Canada agreement (USMCA) and the possibility of extending lapsed or about-to-lapse tax extenders. Several of these topics were under discussion over the weekend so developments could surface early this week. For example, Bloomberg reported that the Trump administration sent House Speaker Nancy Pelosi (D-Calif.) a revised USMCA to review (link for details).
     USDA’s monthly report on World Agricultural Supply and Demand Estimates will be in focus on Tuesday, when China’s agriculture outlook committee will also publish its monthly forecast on supply and demand of soybeans, corn, cotton and sugar.

 

The House takes up legislation to lower the price of prescription drugs, a bill that protects coasts and Great Lakes communities, and will also consider the defense authorization act.

The House could vote on the proposed United States-Mexico-Canada Agreement (USMCA) as early as this week if agreement can be reached on labor enforcement, Rep. Steny Hoyer (D-Md.) said, adding that he and House Speaker Nancy Pelosi (D-Calif.) want a revamped trade pact "passed as soon as possible." Top U.S. and Mexico trade officials met over the weekend, trying to find the right compromises on a few lingering issues. Further discussions between top trade officials will continue Monday, with Mexico's top trade official returning to Washington for meetings with U.S. Trade Representative Bob Lighthizer.

House Rules Committee will meet Tuesday to consider a farm labor bill that would enable employers to get undocumented agricultural workers on a path to legal status and make changes to the current H-2A Visa program. The bill would also establish a mandatory electronic system, known as E-Verify, to confirm an individual’s identity. Full House consideration is possible after the committee vote. A final labor reform bill is facing high hurdles getting out of the Senate and on to the White House.

Tax matters. House Ways and Means Committee is looking at a potential markup of bill that would ease the $10,000 cap on federal deductions for state taxes paid. Meanwhile, lawmakers and staff from both chambers continued working this weekend on trying to reach agreement on tax extenders, including the lapsed $1 per gallon biodiesel incentive. If no accord is evident early this week, this topic is either dead or punted to 2020.

The House Judiciary panel on Monday holds a second hearing on impeachment probe into President Trump with presentations by chief counsels for both parties on Intelligence and Judiciary panels. On Thursday, the panel could begin to draft the articles of impeachment.

The Senate considers several nominations; cloture has been filed on the nomination of Stephen Hahn to head FDA and John Sullivan to be ambassador to Russia.

The Department of Justice watchdog on Monday will release a report on FBI surveillance in the election probe.

The economic calendar is highlighted by the Federal Open Market Committee's interest rate announcement on Wednesday following its two-day policy meeting. Officials have signaled that they are holding interest rates steady unless economic data meaningfully worsens, but Federal Reserve Chairman Jerome Powell's post-meeting remarks will be widely followed as usual.

Economic and Federal Reserve appearances for the week include:

Tuesday:
— FOMC Meeting Begins
— National Federation of Independent Business releases its Small Business Optimism Index for November. Consensus estimates are for a 103.1 reading, compared with October’s 102.4.
— Productivity and Costs

Wednesday:
— MBA Mortgage Applications
— Bureau of Labor Statistics (BLS) reports the Consumer Price Index for November. Expectations are for a 2% year-over-year rise, compared with October’s 1.8% gain. Core CPI, which excludes volatile food and energy prices, is seen rising 2.3%, the same as October.
— Atlanta Fed Business Inflation Expectations
— Quarterly Services Survey
— Federal Open Market Committee announces its decision on interest rates following its two-day meeting. The FOMC cut interest rates three times this year and has signaled that it wouldn’t reduce them further unless the economy slowed sharply.
— Federal Reserve Chairman press conference
— Treasury Budget

Thursday:
— Jobless Claims
— BLS releases the Producer Price Index for November. Economists forecast a 1.2% year-over-year gain. The core PPI is expected to jump 1.7%. This compares with respective 1.1% and 1.6% annual gains in October.
— Fed Balance Sheet
— Money Supply

Friday:
— New York Fed President John Williams gives lecture at the Borough of Manhattan Community College
— Census Bureau reports seasonally adjusted Retail Sales for November. Consensus estimates are for a 0.5% gain, compared with a 0.3% rise in October. Excluding autos and gas, retail sales are expected to rise 0.4% after a 0.1% gain in October.
— BLS releases export and import data for November. Imports are expected to rise 0.2% after a 0.5% fall in October. Exports are seen rising 0.1% after falling 0.1% in October.
— Census Bureau releases Business Inventories for October. Look for a seasonally adjusted 0.2% rise.

Key USDA & international ag and energy-related reports and events on tap:

Link for USDA reports this week.

Monday, Dec. 9

Ag reports and events:

  • Export Inspections
  • Crop Progress
  • EU weekly grain, oilseed import and export data

Tuesday, Dec. 10

Ag reports and events:

  • Cotton Ginnings
  • Crop Production
  • WASDE
  • Cotton: World Markets and Trade
  • Grains: World Markets and Trade
  • Oilseeds: World Markets and Trade
  • World Agricultural Production
  • China agriculture outlook committee (CASDE) to publish monthly supply/demand forecast for soybean, corn, cotton and sugar
  • Brazil’s Conab releases soybean, corn yield and output; corn production
  • Malaysian Palm Oil Board releases data on palm oil stocks, exports and production as of end-Nov.
  • Malaysia’s Dec. 1-10 palm oil shipment data
  • France agriculture ministry updates 2019 grain production forecast
  • Brazil Unica cane crush, sugar production (tentative)
  • Brazil’s beef exporter Abiec holds press conference to present 2019 figures, 2020 outlook
  • Holiday: Thailand

Energy reports and events:

  • API weekly U.S. oil inventory report
  • EIA’s monthly Short-Term Energy Outlook report, including U.S. crude production estimates
  • Capital One Energy Conf. in Houston, through Dec. 12

Wednesday, Dec. 11

Ag reports and events:

  • Broiler Hatchery
  • Feed Grains Database
  • Meat Price Spreads
  • Dairy Data (Dairy Monthly Tables)
  • Wheat data
  • FranceAgriMer’s grains press conference

Energy reports and events:

  • EIA weekly U.S. oil inventory report
  • U.S. weekly ethanol inventories
  • OPEC Monthly Oil Market Report

Thursday, Dec. 12

Ag reports and events:

  • Weekly Export Sales
  • Cotton and Wool Outlook
  • Oil Crops Outlook
  • America's Diverse Family Farms
  • Feed Outlook
  • Rice Outlook
  • Wheat Outlook
  • CE: Barley, Oats, Wheat
  • JSG Commodities hosts 11th annual commodity symposium covering cocoa and sugar market outlook in New York
  • Port of Rouen data on French grain exports

Energy reports and events:

  • EIA natural gas storage change
  • IEA monthly Oil Market Report

Friday, Dec. 13

Ag reports and events:

  • CFTC weekly commitments of traders report on various U.S. futures and options contracts.
  • Peanut Prices
  • Feed Grains: Yearbook Tables
  • Season Average Price Forecast
  • Coffee: World Markets and Trade

Energy reports and events:

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

Other reports and events this week include:

Monday, Dec. 9

  • USDA Sec. Sonny Perdue speaks at the National Grain and Feed Association’s (NGFA) 48th annual Country Elevator Conference and Trade Show in Indianapolis, Indiana.
  • DOJ Inspector General Michael Horowitz plans to release his report into FBI surveillance operations conducted during a probe into Russian interference in the 2016 presidential election.

Tuesday, Dec. 10

  • SEC Chairman Jay Clayton testifies at Senate Banking Committee hearing on oversight of the commission.
  • 2018 Farm Bill. House Ag Livestock & Foreign Ag Subcommittee hearing on “The Implementation of Farm Bill International Food Assistance and Development Programs.”
  • Sulfur standard for marine fuels. Senate Energy Committee hearing to examine implementation of International Maritime Organization’s sulfur standard for marine fuels.
  • Drug supplies to U.S. House Energy and Commerce subcommittee hearing on oversight of the FDA’s foreign inspection program for drug supplies to the United States.
  • Universal health care coverage. House Energy and Commerce panel’s health subcommittee hearing on proposals to achieve universal health care coverage.
  • China. Pro-democracy activist Joey Siu testifies at House Foreign Affairs subcommittee hearing on political and religious human rights issues in China.
  • Iraq. Joey Hood, principal deputy assistant secretary, Bureau of Near Eastern Affairs, State Dept., testifies at House Foreign Affairs subcommittee on the future of Iraq.

Wednesday, Dec. 11

  • DOJ Inspector General Michael Horowitz testifies at Senate Judiciary Committee hearing to examine his report into FBI surveillance operations conducted during a probe into Russian interference in the 2016 presidential election.
  • House Ag Committee “Member Day' hearing.
  • Farm credit. House Ag Committee hearing on “Review of Credit Conditions: Report from Agricultural Lenders.”
  • SBA nomination. Senate Small Business Committee hearing on nomination of Jovita Carranza, President Trump’s pick to lead the Small Business Administration.
  • NTSB nomination. Following a morning session to mark up legislation, Senate Commerce Committee will hold a hearing to consider the nomination of Thomas Chapman to be member of the National Transportation Safety Board (NTSB).
  • U.S. policy in Syria. Defense Sec. Mark Esper and Mark Milley, chairman of joint chiefs of staff, testify at House Armed Services Committee hearing on U.S. policy in Syria and the greater region.
  • Federal Reserve announces monthly interest rate decision; expected to hold rates steady.
  • Sanctions on Turkey and Russia. Senate Foreign Relations Committee meeting to consider bills that would impose sanctions on Turkey and legislation that would impose sanctions on Russian individuals, cyber operations and liquid natural gas export facilities.
  • Boeing's 737 Max jetliner. FAA administrator Stephen Dickson testifies at House Transportation Committee hearing to examine the regulator’s oversight of the certification of Boeing’s 737 Max jetliner.

Thursday, Dec. 12

  • SEC Commissioner Hester Peirce speaks at National Economists Club event.
  • Education Sec. Betsy DeVos testifies at House Education Committee hearing.
  • Energy Sec. Dan Brouillette will speak at a National Petroleum Council meeting.

Friday, Dec. 13

  • President Trump hosts Paraguay’s President Mario Abdo Benitez at the White House, where they will discuss bilateral trade.
  • Trump financial records. The Supreme Court holds a private conference where the justices are expected to discuss whether to take up President Trump appeals seeking to prevent his financial records from being turned over to prosecutors and Congress.

 

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