FOMC Meeting Begins, Trump on Trade and Junk Food
March 20, 2018
Senate prepares for vote to end U.S. military operations in Yemen on Tuesday; In NAFTA Talks, Trump administration attempts to limit junk food warning labels; U.S. 2-year Treasury note yield reaches 2008 high as Federal Open Market Committee (FOMC) meeting begins.
- Senate prepares for vote to end U.S. military operations in Yemen on Tuesday. The Senate has formally teed up a vote on ending U.S. military involvement on Tuesday, expected at approximately 4:15 p.m. ET. The resolution, spearheaded by Sens. Bernie Sanders (I-Vt.), Mike Lee (R-Utah) and Chris Murphy (D-Conn.) would require any U.S. forces not involved in fighting Al-Qaeda or related groups to leave the country within 30 days. The United States has provided support for the Saudi campaign in Yemen’s three-year civil war. Yet the resolution faces an uphill battle in a GOP-controlled Congress, with the Trump administrationa and Republican leadership opposed to it. Supporters of the resolution are using a provision of the International Security and Arms Export Control Act of 1976 to force the vote. [The Hill]
- In NAFTA Talks, Trump administration attempts to limit junk food warning labels. Urged on by large American food and soft-drink companies, the Trump administration is using the North American Free Trade Agreement (NAFTA) trade talks with Mexico and Canada to attempt to limit the ability of the pact’s three members – including the United States – to warn consumers about the dangers of junk food, according to confidential documents that outline the American position. The American stance is a reflection of the battle between trade officials, the food industry, and governments across North America. The Trump’s administration could help insulate American manufacturers from pressure to include more explicit labels on their products, both abroad and in the U.S. However, health officials worry that limiting junk food warning labels will impede efforts to address the growing health crisis of obesity. Obesity has at least doubled in 73 countries since 1980. Public health officials worry about the rapid spread of highly processed foods and have proposed the use of vivid warnings on foods with high levels of sugar, salt and fat, to help address this issue. Officials in Mexico and Canada are discussing options like using colors, shapes, and symbols to warn consumers of health risks. Yet the Office of the United States Trade Representative, which leads the Nafta talks on the American side, is trying to limit the ability of any Nafta member to require consumer warnings on these packaged foods and drinks. [NYTimes]
Economic Indicators & News
- U.S. 2-year Treasury note yield reaches 2008 high as Federal Open Market Committee (FOMC) meeting begins. U.S. government debt yields rose on Tuesday, with the yield on the 2-year Treasury note reaching a nine-year high as the Federal Open Market Committee (FOMC) began a two-day meeting to decide on interest rates. The yield on the 2-year note surpassed 2.332 percent, the highest level since Sept. 9, 2008, while the yield on the 10-year Treasury note topped 2.888 percent, its highest level in more than a week. The yield on the benchmark 10-year Treasury note was higher at around 2.881 percent as of 11:55 a.m. ET, while the yield on the 30-year Treasury bond was higher at 3.113 percent. Bond yields move in the inverse direction of prices. Leaders of the FOMC gathered on Tuesday for the first of a two-day meeting on monetary policy and adjustments to the federal funds rate, the first meeting led by newly-appointed Fed Chair Jerome Powell. The Federal Reserve’s policy arm is expected to raise interest rates for the first time in 2018. [CNBC]