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We kickoff the day with MBA 30-Year Mortgage Rate, MBA Mortgage Applications, MBA Mortgage Market Index, MBA Mortgage Refinance Index, and MBA Refinance Index at 6:00 A.M., Core Inflation Rate MoM & YoY, Inflation Rate MoM & YoY, CPI, and CPI s.a. at 7:30 A.M., EIA Energy Stocks at 9:30 A.M., 17-Week Bill Auction at 10:30 A.M., Crop Production USDA Supply/Demand, and WASDE Report at 11:00 A.M., Fed Rate Decision at 1:00 P.M., Fed Press Conference at 1:30 P.M., and Dairy Products Sakes at 2:00 P.M.

CPI, Fed Rate Decision, and WASDE in one day. Can we handle any more good news? Not! The National Federation of Independent Business’s monthly Small Business optimism in May rose 1% from April and was 1% higher than a year ago at a 5-month high of 90.5. While 22% of small business owners indicated that inflation was still their greatest challenge, while a net negative 8% of owners indicated that their current inventory stocks were too low. This was the lowest since October 1981. (After the Carter years). A net 15% of owners indicated plans to higher this year, which was a new high for 2024, while a net 28% of owners are planning price hikes. 6% of owners indicated that financing was their top business problem, the most since June 2010. Overall, the index continues to hold near decade-long lows and has been below long-term average for 29 consecutive months.

Black Sea Forecast Abruptly Warmer & Drier- Drought to Worsen. The EU model does allow scattered showers to reach E Ukraine/S Russia beyond June 17^th, but on balance the Black Sea forecast is much drier than was advertised on Monday evening. No longer is soaking rain forecast next week, and soil moisture loss occurs for another 7-8 days. Temps in E Ukraine/ S Russia stay in the 80’s indefinitely, while zero rain is projected into the weekend. The collision of frost and severe drought trims 12-14 MMT’s from Black Sea wheat production year-over-year. Tuesday’s elimination of heavy rainfall there keeps corn yield risk intact.  Will WASDE show this? Also China tendered for more US soybeans for the 4^th time since last week. Chinese and Central US weather is threatened with extreme heat. Brazil has modified their tax structure slightly for exporters. All the farmers claims of a global food shortage is becoming a reality that cannot be denied. Denial got us here in the first place.

Buckle Up Your Chinstrap for A Wild Day!

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