Britain Has Not Fallen
June 12, 2017
Dennis Gartman is editor and publisher of The Gartman Letter, and strategic advisor of the AdvisorShares Gartman Currency Hedged Gold ETFs (GEUR & GYEN). He regularly contributes to AlphaBaskets and lends his institutional insight to educate advisors and investors about commodities and the forex markets, including about trading gold in different currency terms.
The US dollar is quietly but generally weaker and the world breathes a bit of a sigh of relief that the British government has not fallen despite the Tory “losses” that were announced late last Thursday and were made official into early Friday morning. The markets in Europe are happier to find that Mr. Macron and his newly created party… the La Republique en Marche… have moved on to what shall official be a massive sweep of the Parliamentary elections there yesterday. After the first round of voting… and there shall be a runoff this coming Sunday; a peculiarity not just to French Presidential and parliamentary voting but to many counties in Europe… Macron & Company have carried the day.
Indeed, the voting in favor of La Republique has been so large that several of the leading Socialist members of Parliament that have been veritable fixtures there and in French politics for decades have been voted out of office. This was, if nothing else, a truly humiliating election for the once powerful Socialist Party in France.
Here in the States, the focus shall be upon two things: the appearance tomorrow before the Senate by the Attorney General, Mr. Sessions, and of course the two day FOMC meeting which begins tomorrow and shall end Wednesday with Dr. Yellen’s post-meeting press conference.
Regarding Mr. Sessions’ appearance before the Senate, we must remember that it was rumoured that he came very close to resigning his post over confusion regarding the Russian election tampering circumstances. Thus, despite having been an early and very vocal supporter of Mr. Trump during the campaign, there appears now to be a rift between the Attorney General and the President. Mr. Sessions sent a letter to the Chairman of the Senate Committee in question on Saturday saying he was prepared to speak on the record about Mr. Comey’s testimony last week. We have no idea what Mr. Sessions shall say and we…and the markets… await his comments. At this point, however, it is not clear if Mr. Sessions’ appearance before the committee shall be open to the public and thus televised, or whether it shall be in closed session.
As for the FOMC meeting, it is, for all intents, a truly foregone conclusion that the o/n fed funds rate shall be raised by 25 bps. Indeed, the only question that shall come out of the meeting and shall be included in the post-meeting communique and discussed by Dr. Yellen in her post-meeting press conference is how many more rate increases shall the Fed push for through the remainder of this year.