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On June 20, 2019, bond yields fell across the board and the U.S. dollar depreciated after the FOMC left rates unchanged but opened the door to pre-emptive easing. Equities rose in response.
Geopolitical concerns also rose after Iran said it shot down a U.S. military spy drone.
Lower U.S. yields and a weaker dollar support commodity prices and ease financing costs for feed buyers. The Iran drone incident adds some risk premium to energy, which can feed through to feed transport and processing costs.
bbvaresearch.comVitor Sun Zou, Cristina VarelaJun 20, 2019After 1,637 past bearish macro events, US Dollar (Broad) moved a median -0.2% over 5 sessions (39% higher; middle half -0.6% to +0.3%), and -0.2% over 20.
After 487 past bullish macro events, Crude Oil (WTI) moved a median +1.0% over 5 sessions (60% higher; middle half -2.0% to +4.0%), and +1.5% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Falling bond yields after the FOMC opened the door to easing reduced dollar yield support on June 20.
