The Federal Open Market Committee is expected to keep the benchmark for rates unchanged in a 2% to 2.25% range today. Markets will only have a statement to interpret indications of modification to economic outlook by the Federal Reserve. The Fed fund rate is now at the highest level since October 2008.
UK Prime Minister May will travel to Brussels tonight to negotiate with EU leaders for additional time to obtain a Brexit agreement with her Cabinet. May openly appealed to Angela Merkel and EU Council Chair Donald Tusk to keep the opportunity of a deal this month on the table.
The European Union has criticized Italy’s budget proposal of being overly optimistic regarding the effect of its outlay program. The dispute has led to speculation in Italy that an early election may be called, as pressure on the coalition increases. Italian bonds dropped this morning, with 10-year yields rising significantly.
Canadian crude prices have fallen to a two year low of $19.87 this morning as the discount compared to the US benchmark becomes more dramatic. Issues of supply coupled with transportation limitations have fueled the problem. This comes as Prime Minister Trudeau’s government attempts completion of a pipeline expansion project and the passing of legislative reforms for the approval of future projects.