Perspective: Morning Commentary December 10

By: Arlan Suderman, Chief Commodities Economist

Wed, 10 Dec 2025, 14:25

December 10 – Wall Street continues to hit the pause button while waiting for the Federal Reserve to release its revised monetary policy statement this afternoon. The major stock indices traded both sides of unchanged in relatively quiet trade overnight. The VIX is trading near 17 this morning, while the dollar index is trading near 99.1. Yields on 10-year Treasuries are trading near 4.19% this morning, after peaking at fresh three-month highs a couple of points above that earlier in the session, while yields on 2-year Treasuries are trading near 3.61%. Crude oil prices are trading modestly weaker this morning, while continuing to trade largely within a range of $58 to $60 per barrel. The grain and oilseed markets were mostly weaker overnight, with the exception of the edible oils markets.

Wall Street priced in expectations of another 25-basis-point rate cut from the Federal Reserve today, and the Fed has done little to prepare the markets for anything different. As such, the surprise would be if there were a larger cut, or possibly no cut at all. But this afternoon’s focus is expected to be on the guidance we receive from the Fed regarding future potential cuts, via wording in the policy statement, but primarily from Chairman Jerome Powell in his press conference after the statement release. That is largely expected to set the tone for the markets to close out today’s trade and going forward.

The White House no doubt will continue to lobby for more rate cuts. This is not the first administration to pressure the Fed to cut rates, but it is probably the most aggressive we have seen any administration in lobbying the central bank for lower rates. We all like lower interest rates, and lower rates certainly provide many benefits to any administration in office, even if it ends up costing the next administration via increased inflation pressures. What we want is not always best for us. The primary question is, what is the “neutral” interest rate for our economy that is neither stimulative nor restrictive? Many economists think it is somewhere near the 2.5 – 3.0% level, whereas I think it is probably north of 4%. M2 money supply is at record high levels, but this economy is largely being held back by “uncertainty” more than it is high interest rates. We’ve seen 150 basis points of cuts since September of last year, with little to show for it in fixing the soft employment issue, largely because interest rates are not what’s restricting our employment picture, in my view. So now we want to do more of the same and expect a different result.

Meanwhile, the long end of the yield curve pushes higher. This has been the trend for much of the past 15 months. The long end of the yield curve is not following the Fed lower. That hasn’t happened very often over the history of our economy. The Fed only controls the very near-term interest rate, while it tries to influence the longer end of the yield curve. The long end of the yield curve tells us a few things. It says that it is still worried about inflation. It says that it is very concerned about Congressional deficit spending that continues to absorb an increasing portion of the available investable funds in our economy. And it is concerned that the Supreme Court will rule any day now against President Trump’s tariffs, requiring the Treasury to make massive refunds when it doesn’t have the funds to do so. We would do well to listen to what bond traders are telling us via the market.

Chinese cash traders purchased more than 20 cargoes of U.S. soybeans last week, according to our sources. The total purchases are believed to have topped 1.5 million metric tons, bringing total purchases to date close to 6 mmt. That would equate to roughly half of the 12 mmt committed for 2025. The definition of “2025” continues to evolve, and we still do not have a finished trade agreement document to see how China defines it. But the White House now seems to be defining it as the 2025-26 “growing season” (marketing year?). If that is the actual definition, it doesn’t change my expectations. I expected the 12 mmt committed to for 2025 to be roughly all that China purchases in the current marketing year, with the next 25 mmt going to the 2026-27 marketing year, if it actually keeps those commitments. However, China is also offering 0.5 mmt for auction per week to crushers starting tomorrow, with the total expected to be released from China’s reserve totaling 3 – 4 mmt. That confirms our concerns that China doesn’t have enough storage for the committed soybeans, so it is releasing older soybeans in reserve to make room. That in turn is expected to reduce what it purchases from Brazil.

Bulls need to be fed every day, and yesterday’s USDA WASDE report failed to provide fresh fodder for the bulls. January soybeans experienced a technical failure on the charts on Friday, and we’re still paying the price. That weighs on corn prices, and yesterday’s WASDE notably increased supplies among the world’s major wheat exporters. Corn export demand remains robust, but we still have plenty of corn to fill that demand, especially if feed demand is being overstated, as the industry believes that it is. The question now is, will the major funds begin to see incentives to own commodities as a hedge against higher inflation risks in 2026?

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Perspective: Morning Commentary for August 4

August 4 – The benchmark Dow Jones Industrial Average surged into the close yesterday to finish almost 700 points higher, at a record close of 53,178 points – easily clearing the previous top from almost a month ago. The S&P 500 is on the brink of its own record as well, while the NASDAQ index is short of June highs but working on a strong three-session rally. All three are pointing to positive openings today. Palantir (a U.S. software company) reported better-than-expected earnings yesterday afternoon post-close to boost the tech sector, though a host of other firms reported strong earnings as well. The ten-year note continues to retreat from Friday’s high, now at 4.67%, with the dollar on the high side of level-par, while the VIX index now under 16 shows reduced volatility.

Matt ZellerTue, 04 Aug 2026, 12:43

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Perspective: Morning Commentary for August 3

August 3 – Equities futures are pointing higher to open the week and month, still in range of recent record highs and flush with optimism that the U.S. and others will start to negotiate with Iran over the Strait of Hormuz. A busy week is on tap with earnings reports and jobs data, among other economic releases. Crude oil is down over $5 per barrel and nearing in on three-week lows. The dollar is only slightly lower this morning but at its own month-and-a half low, while the U.S. ten-year note is also slightly on the low side at 4.68. The VIX index is rebounding a bit today after a sharp slide into the end of last week, just above 16.

Matt ZellerMon, 03 Aug 2026, 12:45

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Perspective: Mid-Day Commentary for July 31

July 31 – Stocks are clinging to modest gains at midday, with largely better than expected U.S. economic data today providing some optimism to end the week. The VIX briefly spiked to 18.7 earlier in the session but has since settled back to 17.15 at midday. The dollar has given back some of its gains on the day, now only modestly in the green, up roughly 0.1% to trade near 100.06 at the time of writing. Treasury action has been mixed thus far today, but yields remain notably elevated, with 30-year yields trading just below their 19-year high at 5.267%, 10-year yields just off their one-and-a-half-year high at 4.74%, and 2-year yields right at 4.30%. Crude oil remains quietly higher, with nearby WTI up 0.9% on the day near $84.70 and nearby Brent up 0.7% to trade near $87.40. The grains and oilseeds are widely lower at midday, with the wheat complex leading the way down, while the livestock sector is largely in the green.

Mike CastleFri, 31 Jul 2026, 16:33

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