President Donald Trump (Nicholas Kamm/AFP/Getty Images)
The Trump administration says the US will impose 10% tariffs on an additional $200 billion in Chinese products, noting "China has been unwilling to change its practices." China responded with its own tariffs on $60 billion worth of US imports.
A second set of tariff-related aid for farmers may be announced in December, according to an Agriculture Department white paper. The paper says the payments may be geared to ease new US tariffs against trade partners, including the European Union and China.
Commodity Futures Trading Commission member Rostin Behnam has reassured farmers the regulator "remains vigilant" in ensuring block trades do not harm agricultural futures markets. "The prices of blocks appear to be priced within the CME [Group] rule for 'fair and reasonable' prices," according to a CFTC analysis.
Implied volatility in the trading of precious metals is now no more than 2%, a historic low. Jin Chang, global head of metals at CME Group, notes this is occurring amid high volume as well as strong foreign interest and explores the implications in a video interview.
Rapid development of US shale production has transformed energy markets and elevated US liquefied natural gas in the global mix, said Derek Sammann, senior managing director, global head of commodities and options products for CME Group. "We're seeing a de-linking of LNG from crude oil prices. And the rapid evolution of a global gas market with Henry Hub as the global benchmark," Sammann said.
Deliveries of US liquefied natural gas to China are slowing down amid mounting trade tensions between the two countries, with only four vessels going to China since June, down from 17 in the first five months of 2018. China was expected to import 141.6 billion cubic feet of US LNG this year, but the actual figure will likely be less than 100 billion cubic feet.
After losing its place among the top three for commodities revenue last year due to losses in the natural gas and power market, Goldman Sachs Group has rebounded to share the top slot with Morgan Stanley and JPMorgan Chase, according to Coalition Development. The tie listing means the banks' net commodities revenues were within 10% of each other during the first half of 2018.
Former Goldman Sachs commodities division executives Don Casturo, Tom Glanfield and Daniel Cepeda are preparing to launch Quantix Commodities, a long-only fund that will actively manage futures positions.
China's Fosun International has been in ongoing discussions for months to acquire Britain's commodities broker Marex Spectron, sources say. A decision is expected to be announced by the end of the month.
CME Group Chairman and CEO Terry Duffy is calling for the industry to improve its image among young people as a way to boost recruitment 10 years after the 2008 financial crisis. "In these efforts, we must do more to convey the value of our markets -- to both consumers and future candidates alike -- and demonstrate how the deployment of capital fuels innovation and growth across industries, while improving the lives of countless people," he writes.
US wages are rising, but what does this mean for inflation or corporate profits? CME Group Chief Economist Bluford Putnam examines the wage and profit landscape since the financial crisis and concludes that wage gains, such as they are, are merely catching up a bit with the surge in profits seen since 2008.
Tariffs and trade tensions so far have had little effect on US job growth in a favorable environment generated by tax cuts and a sound economy. Scott Bauer, however, warns this may not last as the trade situation develops.