Trump/Xi Confab in Japan | USTR Lighthizer Meets in Japan Re: Trade Accord

Posted on 06/23/2019 6:39 PM

USDA Acreage, Grain Stocks, Hogs & Pigs reports | Dem presidential debates

President Donald Trump and China’s Xi Jinping meet over trade war issues at the G20 summit late this week in Osaka, Japan. The leaders are expected to relaunch trade talks between the two nations. Meanwhile, USTR Bob Lighthizer meets with his counterpart in Japan regarding a proposed trade accord that is expected sometime after July elections in Japan.
     The first Democratic presidential primary debates occur Wednesday and Thursday in Miami (see graphic below for details).
     Congress is in this week with both chambers considering border-funding bills.
     USDA on Friday issues its Acreage and Grain Stocks reports, and an update on Hogs & Pigs on Thursday.

 

President Donald Trump will be in Osaka, Japan late this week for the G20 summit, where he will hold an “extended meeting” with China’s Xi Jinping. Both are expected to relaunch trade talks after a monthlong stalemate.

Regarding a coming U.S./Japan bilateral agreement, U.S. Trade Representative Bob Lighthizer will confer with his Japanese counterpart to discuss a deal on agricultural trade. "My hope is we can get back on track,” Lighthizer said last week. “I think it’s in our interest. I think it’s in their interest. Hopefully the politics will line up over there to allow that to happen.”

Lawmakers in both chambers plan to pass supplemental spending bills with billions of dollars to meet humanitarian needs at the border. Senators reached a deal on a $4.6 billion appropriations bill, S 1900, to address a surge in migration at the southern border. House Democrats are working on their own supplemental in preparation for a vote.

The House will continue consideration of HR 3055, a five-bill package encompassing spending for Agriculture-FDA, Commerce-Justice-Science, Interior-Environment, Military Construction-VA, and Transportation-HUD programs. They will also consider a FY 2020 Financial Services spending bill, HR 3351 and a measure on elections security (HR 2722).

The Senate on Monday afternoon will vote on the motion to proceed to S 1790, the defense policy bill. Meanwhile, Sens. Mark Warner (D-Va.) and Josh Hawley (R-Mo.) will introduce legislation to require Facebook, Google, Amazon and other major platforms to disclose the value of their users' data, Warner told Axios on HBO.

House Minority Whip Steve Scalise (R-La.) will discuss the Republican outlook for Congress for the remainder of the year at a Ripon Society event on Thursday.

The Supreme Court is set to hand down its decision on whether the Trump administration can include a citizenship question on the 2020 census. The question has been the subject of multiple legal challenges since it was first announced in early 2018.

Two days of debates will occur this week regarding Democratic presidential candidates. Twenty of the 23 Democrats running for president are set to participate in nationally televised debates this Wednesday and Thursday. But at this early stage, Americans are directing most of their attention to just five candidates (link to Wall Street Journal article). Details of who and when the candidates will debate:

Democratic first two debates

Economic updates for the week include:

Monday:
— Chicago Fed National Activity Index
— Dallas Fed Mfg Survey
— Mexican national statistics agency reports consumer price index data for the first half of June. Inflation fell 0.3% during the first-half of May. Also, Brazil's inflation data is expected to be released.

Tuesday:
— Census Bureau releases new-home sales data for May. Consensus estimates are for a seasonally adjusted annual rate of 677,500, up from April’s rate of 673,000.
— Conference Board releases its Consumer Confidence Index for June. Economists forecast a 131 reading, about even with May’s data, which were near 18-year highs.
— Federal Housing Finance Agency releases its House Price Index for April. Expectations are for a 0.2% rise after a 0.1% increase in March.
— S&P Corelogic Case-Shiller HPI
— Richmond Fed Manufacturing Index
— Canada’s wholesale trade data for April

Wednesday:
— Census Bureau releases its Durable Goods Report for May. New orders for durable goods are expected to rise 0.1% after a 2.1% drop in April. Excluding transportation, new orders are seen gaining 0.2% after a virtually flat reading in April.
— MBA Mortgage Applications
— International Trade in Goods
— Retail Inventories [Advance]
— Wholesale Inventories [Advance]

Thursday:
— Bureau of Economic Analysis releases the third and final estimate for first-quarter gross domestic product. Real GDP for the first quarter increased at an annual rate of 3.1%, according to the BEA’s second estimate, and is expected to remain unchanged with the final release.
— National Association of Realtors releases its Pending Home Sales Index for May. Consensus estimates are for a 104.1 reading, roughly even with April’s data. Year-over-year through April, contract signings for existing homes has declined for 16 straight months, indicating a softening housing market.
— Initial jobless claims for the week ended June 22 is likely to have risen to a seasonally adjusted 218,000.
— U.S. Federal Reserve will report its finding from its annual stress test of large bank operations, including whether the firms will be able to deploy capital to investors as planned.
— Kansas City Fed Manufacturing Index
— Fed Balance Sheet
— Money Supply
— Mexico's central bank holds its monetary policy meeting

Friday:
— BEA releases its Personal Income and Outlays report for May. Economists forecast personal income rising 0.3% after a 0.5% jump in April. Personal spending is seen increasing 0.4%, up from April’s 0.3% gain.
— The PCE core deflator, the Federal Reserve’s favored inflation gauge, is expected to remain unchanged from April’s level of a 1.6% year-over-year rise.
— Institute for Supply Management releases its Chicago Purchasing Manager Index for June. Consensus estimates are for a 54.4 reading, up from May’s 54.2.
— University of Michigan's preliminary consumer sentiment index for June is likely to show a reading of 97.9.
— Statistics Canada data is expected to show gross domestic product in April grew 0.1%, after increasing 0.5% in the March.
— Brazil’s jobless rate data for May is expected to be released; it fell to 12.5% the month before.

Fed speakers on tap:

Tuesday:
— Fed Chairman Jerome Powell on Economic Outlook and Monetary Policy Review, at C. Peter McColough Series on International Economics: A Conversation with Jerome H. Powell, New York, N.Y.
— New York Federal Reserve Bank President John Williams delivers opening remarks at the OPEN Finance Forum in New York, N.Y.
— Atlanta Federal Reserve Bank President Raphael Bostic participates in a panel on "The State of the Nation's Housing 2019 Release" report in Atlanta, Ga.
— St. Louis Federal Reserve Bank President James Bullard gives welcoming remarks at the Homer Jones Memorial Lecture featuring Carmen Reinhart at the Federal Reserve Bank of St. Louis in St. Louis, Missouri.

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

Monday, June 24

Ag reports and events:

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

Tuesday, June 25

Ag reports and events:

  • Chickens and Eggs Final Estimates
  • Honey Final Estimates
  • Poultry Production and Value Final Estimates
  • Intertek, AmSpec, SGS data on Malaysia’s June 1-25 palm oil exports

Energy reports and events:

  • API weekly U.S. oil inventory report

Wednesday, June 26

Ag reports and events:

  • Broiler Hatchery
  • Livestock and Meat Domestic Data
  • South Africa crop estimates
  • Statistics Canada data on grain acreage

Energy reports and events:

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

Thursday, June 27

Ag reports and events:

  • Weekly Export Sales
  • Agricultural Prices
  • Egg Products
  • Hogs and Pigs
  • Peanut Stocks and Processing
  • Malaysia Palm Oil Council Market Forum on marketing
  • International Grains Council monthly report
  • Port of Rouen data on French grain exports
  • Buenos Aires Grain Exchange weekly crop report

Energy reports and events:

  • EIA natural gas storage change

Friday, June 28

Ag reports and events:

  • CFTC weekly commitments of traders report on various U.S. futures and options contracts.
  • Acreage
  • Grain Stocks
  • Rice Stocks
  • Peanut Prices
  • FranceAgriMer weekly update on French crop conditions

Energy reports and events:

  • Baker Hughes weekly U.S. oil/gas rig counts
  • EIA’s Monthly Crude Oil and Natural Gas Production and Petroleum Supply Monthly reports

Other reports and events this week include:

Monday, June 24

  • Congress: House and Senate in session.
  • Sec. of State Michael Pompeo to travel to India and Sri Lanka ahead of G20 trip. Pompeo traveling through June 30 and will visit South Korea for Trump’s meeting with President Moon Jae-in. Pompeo will meet Indian counterpart Subrahmanyam Jaishankar, days after India announced its decision to impose retaliatory tariffs on dozens of U.S. imports.
  • Health-care prices. President Trump plans to issue executive order to compel the disclosure of prices in health care, the Wall Street Journal reports. The order will tell federal agencies to start writing regulations that could require insurers, doctors and hospitals to provide information on the cost of care.
  • Climate change. Microsoft co-founder Bill Gates discusses developing new technologies aimed at mitigating the impact of climate change, at an Economic Club of DC event.
  • National Council of Farmer Cooperatives annual Washington conference, through Wednesday.
  • U.S. Trade Representative public hearings on proposed Section 301 tariff list, through Tuesday, International Trade Commission.

Tuesday, June 25

  • Congressional Budget Office releases long-term budget projections.
  • Derivatives. Senate Ag Committee hearing on "The State of the Derivatives Market and Perspectives for CFTC (Commodity Futures Trading Commission) Reauthorization." Futures Industry Association President and CEO Walter Lukken and National Futures Association President and CEO Thomas Sexton testify.
  • Conservation. House Ag Conservation and Forestry Subcommittee hearing on "Managing for Soil Health: Securing the Conservation and Economic Benefits of Healthy Soil."
  • Water resources. House Transportation and Infrastructure Water Resources and Environment Subcommittee hearing on "Protecting and Restoring America's Iconic Waters."
  • Mexico labor reform. House Ways and Means Trade Subcommittee hearing on "Mexico's Labor Reform: Opportunities and Challenges for an Improved NAFTA."
  • Natural disasters. House Oversight and Reform Environment Subcommittee hearing on "Recovery, Resiliency and Readiness - Contending with Natural Disasters in the Wake of Climate Change (Part III)."
  • Chronic Wasting Disease. House Natural Resources subcommittee hearing.
  • Fannie Mae and Freddie Mac. Senate Banking Committee hearing to examine whether Fannie Mae and Freddie Mac should be designated as Systemically Important Financial Institutions.
  • Financial technology regulation. House Financial Services hearing to examine fintech regulation.
  • Energy Secretary Rick Perry testifies at House Science Committee hearing on oversight of the department's Research and Development Enterprise.
  • Critical minerals. House Natural Resources subcommittee hearing to examine the risks of uranium mining and a bill from panel chairman Raul Grijalva that would revise the final list of critical minerals.
  • Land and Water Conservation Fund. Senate Energy Committee hearing to review implementation of the Land and Water Conservation Fund program.
  • Reauthorizing healh programs. House Energy and Commerce panel hearing on reauthorizing health programs; will consider legislation including HR 776, the Emergency Medical Services for Children Program Reauthorization Act.
  • Huawei and ZTE. Senate Foreign Relations Committee meeting to consider legislation which would recognize that Chinese telecoms companies like Huawei and ZTE pose serious threats to the national security of the U.S. and allies. Panel also will consider nomination of Eliot Pedrosa to be executive director of the Inter-American Development Bank.
  • Election security. House Science, Space and Technology subcommittees hearing on election security and voting technology vulnerabilities.

Wednesday, June 26

  • Derivatives. House Ag Commodity Exchanges, Energy, and Credit Subcommittee hearing on "Brexit and Other International Developments Affecting U.S. Derivatives Markets."
  • Biodefense. House Oversight and Reform National Security Subcommittee hearing on "U.S. Biodefense, Preparedness, and Implications of Antimicrobial Resistance for National Security."
  • Improving congressional budget process. Gene Dodaro, comptroller general of GAO, testifies before Senate Budget panel on how to improve Washington’s budget and spending process.
  • Russia and China. GOP Sen. Dan Sullivan discusses Russia’s increased military presence and China’s growing economic and scientific presence in the Arctic at a Center for Strategic and International Studies forum.
  • Border security. Senate Homeland Security Committee examines migration at the U.S. southern border and the “exploitation of migrants.”
  • Rail and surface transportation policy. Jennifer Homendy, National Transportation Safety Board member, and Richard Anderson, CEO of Amtrak, testify at Senate Transportation Committee hearing on rail and surface transportation policy and the reauthorization of Amtrak.
  • USDA Sec. Sonny Perdue speaks to the National Council of Farmer Cooperatives.
  • USMCA. Washington International Trade Association forum, “Conversation with Congressman Earl Blumenauer on the U.S.-Mexico-Canada-Agreement.”
  • Food industry. Arizona State University’s Swette Center for Sustainable Food Systems forum, “The Hidden Costs of America’s Food.”

Thursday, June 27

  • President Trump leaves for Osaka, Japan and the G20 summit.
  • House GOP agenda. House Minority Whip Steve Scalise (R-La.) discusses the Republican outlook for Congress for the remainder of the year at a Ripon Society event.
  • Export-Import Bank President Kimberly Reed testifies at Senate Banking Committee hearing on the oversight and reauthorization of the Export-Import Bank.
  • Bank stress tests. Federal Reserve releases results of part two of its annual bank stress tests. Banks with sufficient capital levels can increase dividends and share buybacks.
  • Nuclear waste storage. Senate Energy Committee hearing to examine options for the interim and long-term storage of nuclear waste, and to consider S 1234, a bill that would establish a new Nuclear Waste Administration to manage future sites of nuclear storage.
  • U.S. Special Representative for Iran Brian Hook holds meetings in Saudi Arabia, United Arab Emirates, Kuwait, Oman and Bahrain, to discuss threats posed by Iran. He then then travels to Europe where he will meet counterparts from the U.K., Germany and France in Paris, to discuss issues over Iran.

Friday, June 28

  • The two-day G20 Summit convenes in Osaka, Japan. Focus will be on President Donald Trump and China’s President Xi Jinping. The two leaders are expected to discuss the ongoing trade war.

 

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