Fed Chairwoman Janet Yellen’s Semiannual Monetary Policy Report to Congress and verbal guidance indicating less monetary accommodation or a possible move to raise interest rates before their June 13-14, 2017 Federal Open Market Committee (FOMC) meeting, has heightened uncertainty in the commodity markets.

Commodity markets went from having a bullish bias to a more subdued bias as market participants considered potential actions by the Federal Reserve Board, which Dr. Yellen chairs. A more hawkish Fed could cause a more bullish dollar coupled with a rise in interest rates with the overall impact being potentially negative to commodity prices, export markets, and business profitability.   

To read Chairman Yellen’s remarks, visit Before the Committee on Banking, Housing, and Urban Affairs, U.S. Senate, Washington, D.C. on February 14, 2017, and Chair Yellen submitted identical remarks to the Committee on Financial Services, U.S. House of Representatives, on February 15, 2017.

Her written testimony may be view by clicking on the following: Semiannual Monetary Policy Report to the Congress

See also Bloomberg’s Jeanna Smialek article “Fischer Echoes Yellen Seeing Economy on Fed's Rate Hike Path,” February 16, 2017 says.