Highlights
The House of Representatives passed a resolution yesterday to force the adoption of the agreement by the railroads and the unions and passed a second resolution requiring the railroads to allow seven days of sick leave for the union members. The Senate must approve both measures for it to be sent to the White House for Biden to sign. Will the Senate pass the same two bills? Probably. Will Biden sign it? Probably. Will all of the above happen within a matter of days? Probably not, but disruptions are not likely to do any more than hurt basis for a few days at railroad terminals. The futures market reaction will be friendly, even if Biden signs it after the strike deadline.
Fed Chairman Powell said yesterday his final interest rate target is higher than where interest rates are now, but the pace to get there will be slower than he previously expected due to reduced rates of increased inflation last month. Probably means interest rate increases of 50 basis points for a month or two instead of 75 basis points.