Soybean futures fell at the Chicago Board of Trade by more than 1% to below $12 a bushel on profit-taking after a day of trading near two-month highs.

Conversely, wheat futures gained ground today while corn ended mostly flat after a volatile session.

Soybean prices fell after a two-session advance due to a variety of factors, including expectations of rainfall in the Iowa state during the weekend. Iowa is the largest corn and soybean producer in the US, and is currently suffering from drought in large swaths of the state. 

Otherwise, wheat prices rose amid renewed concerns about disruptions to Black Sea supplies due to mounting Russia-Ukraine tensions. 

The European Commission is currently considering imposing tariffs on grain imports from Russia and Belarus to prevent Moscow from distorting EU markets.  

However, traders noted that Russian shipments to the EU are minimal compared to Ukraine, so the tariffs are just symbolic. 

Corn

Corn May futures fell 0.3% to $4.39 a bushel.

Soybeans

Soybean futures due in May fell 1.6% to $11.92 a bushel. 

Wheat 

Wheat May futures fell 1.7% to $5.54 a bushel. 

US stock indices mostly lost ground on Friday while still heading for weekly gains as investors continue to assess the Fed’s policies. 

The Federal Reserve recently announced plans to maintain interest rates at below 5.5% for the fifth meeting in a row. 

Fed officials reasserted their expectations of three interest rate cuts in 2024, boasting the case for a June rate cut. 

Fed Chair Jerome Powell said at this post-meeting press conference that the Fed is on track to cut interest rates this year. 

He added that interest rates have likely peaked, and that inflation readings in the last two months indicate a downward trajectory. 

On trading, Dow Jones fell 0.5%, or 185 points to 39,595, while S&P 500 fell 0.1%, or 6 points to 5235, as NASDAQ shed 0.1%, or 10 points to 16,411. 

The dollar rose in European trade on Friday against a basket of major rivals for a second day, hitting five-week highs and on track for the second weekly profit in a row. 

Now investors await an important speech by Fed Chair Jerome Powell later today, expected to include clues on the future of US interest rates.

The Index 

The dollar index rose 0.45% to 104.45, the highest since February 16, with a session-low at 103.92, after closing up 0.6% yesterday, the largest profit since February 13 after a surprise decision by the Swiss National Bank to cut interest rates by 25 basis points. 

The decision comes as Swiss inflation hit 1.2% in February, the ninth month in a row of sub 2% inflation rates. 

The Fed 

As expected, the Federal Reserve maintained interest rates unchanged at 5.5%, a 2002 high, for the fifth meeting in a row. 

The Fed said that recent indices showed that US economic performance is still strong, with high employment gains and weakening inflation, although it remains high. 

Fed Chair Jerome Powell said the FOMC members are committed to bringing inflation to the 2% target, noting that inflation while slowing is still above the target. 

He added that US inflation remains high and the Fed is paying attention to it, and that higher inflation than expected in February didn’t change the Fed’s outlook. 

He added that if the US economy performed as expected, it could be appropriate to start cutting rates this year. 

US Rates

Following the Fed’s meeting, the odds of a 0.25% interest rate cut in June surged to 75%. 

Powell

Now markets await an important speech by Fed Chair Jerome Powell later today, expected to shed more light on the likely path ahead for US interest rates. 

Gold prices fell in European trade on Friday on track for the second loss in a row off record highs at $2200 on profit-taking. 

The precious metal is pressured by a surge in dollar against major rivals, making greenback-denominated gold futures costlier to holders of other currencies. 

The precious metal is still on track for a weekly profit after the Federal Reserve maintained its forecasts for interest rate cuts this year, underpinning gold.

Gold Prices Today  

Gold prices fell 0.85% to $2162 an ounce, with a session-high at $2186, after losing 0.25% on Thursday away from a record high of $2222. 

The Dollar

The dollar index rose 0.4% on Friday, extending gains for the second straight session and hitting a five-week high at 104.42 against a basket of major rivals. 

The gains come amid optimism about the economic performance in the US, and the likelihood that other global central banks will rush into rate cuts before the Federal Reserve. 

Weekly Trades

Gold prices are up 0.5% so far this week on track for the first weekly profit in five weeks following the Fed’s policy meeting. 

The Fed 

As expected, the Federal Reserve maintained interest rates unchanged at 5.5%, a 2002 high, for the fifth meeting in a row. 

The Fed said that recent indices showed that US economic performance is still strong, with high employment gains and weakening inflation, although it remains high. 

The Fed said that any changes for interest rates will require careful examination of inflation data and upcoming risks. 

It asserted it won’t cut interest rates until further confidence is gained about reaching the 2% inflation target.

Economic Outlook

The Fed’s quarterly economic outlook report included important revisions:

For growth, the Fed changed its outlook for 2024 growth from 1.4% to 2.1%, and for 2025 growth from 2.0% to 1.8%, and for 2026 growth from 2.0% to 1.8%. 

For main inflation, the Fed maintained its 2024 inflation forecast at 2.4%, and the 2025 forecast at 2.2%, and the 2026 forecast at 2.0%.

As for core inflation, the Fed changed its 2024 forecast from 2.4% to 2.6%, and the 2025 forecast is still at 2.2%, and the 2026 forecast is still at 2.0%. 

Finally, the Fed maintained its interest rate targets this year at 4.75%, and at 4.0% next year. 

Powell

Fed Chair Jerome Powell said the FOMC members are committed to bringing inflation to the 2% target, noting that inflation while slowing is still above the target. 

He added that US inflation remains high and the Fed is paying attention to it, and that higher inflation than expected in February didn’t change the Fed’s outlook. 

US Rates

Following the Fed’s meeting, the odds of a 0.25% interest rate cut in June surged to 75%. 

The SPDR

Gold holdings at the SPDR Gold Trust remained flat yesterday at a total of 838.5 tonnes, the highest since February 14.