Natural Gas Closes Below $8

Despite there being no official
economic reports today,

there was still a lot of news flow — including a
record $2.77 trillion US Budget proposal. Go to our
Economic
News
section for highlights of today’s comments by President Bush, new Fed
Chairman Ben Bernanke and the Fed’s Fisher.

Treasuries closed lower, with losses more pronounced
at the short-end of the curve as traders increased positions indicating the Fed
will continue to raise rates. Bloomberg reported “Interest-rate futures show
traders are pricing a 90 percent chance the central bank will raise the federal
funds target rate to 4.75 percent at its next meeting on March 28, up from 58
percent two weeks ago. The odds of another increase at the May 10 meeting rose
to 44 percent, from zero percent two weeks ago
.”

The increased likelihood of higher US rates and weak
economic data in Europe helped push the Euro to a 1-month low versus the Dollar.
The Euro also experienced its biggest 1-day drop versus the Yen in almost a
month. The US Dollar Index closed at a new 2006 high.

All the energies closed lower with Natural Gas
leading the decline. Natural Gas closed below $8 for the first time since July
2005.

In the softs, Coffee hit a 1-month low on reports of
a large crop in Brazil. Orange Juice neared contract highs ahead of this week’s
crop estimate report. Lumber closed limit-down despite record building permits
data from Canada.

Gold and Silver closed flat in the metals but Copper
hit another new all-time high.

All the grains closed lower, while the meats were
mixed.


Economic News

No economic reports today

Ashton Dorkins

ashtond@tradingmarkets.com

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