Cotton set for worst day since October on dollar rebound

Reuters

Published Nov 15, 2022 05:29

Updated Nov 15, 2022 05:39

(Reuters) - ICE (NYSE:ICE) cotton futures fell as much as 3.5% on Monday, and were set for their biggest drop in eleven sessions, as a bounce-back in the U.S. dollar dented overseas demand for the natural fiber.

* The most-active cotton contract for March fell 2.68 cents, or 3.1%, to 83.65 cents per lb at 12:50 ET (17:50 GMT) after shedding as much as 3.5% to 83.33 cents a lb, which could be its worst day since Oct. 28.

* "I don't see a whole lot that would move this market other than technical factors and the dollar," said Jon Marcus, president of Lakefront Futures and Options brokerage in Chicago, who saw 86.50 cents per lb as "a spot that's been troublesome for cotton."

* "If the dollar breaks, that might give the buyers a little bit of courage in here but... cotton at 80 cents and above is a pretty good level historically."

* The dollar index rose 0.6%, making U.S. cotton more expensive for holders of other currencies.

* Also weighing on sentiment, Wall Street's main indexes slipped as hawkish comments from a U.S. Federal Reserve official tempered hopes of the central bank toning down its aggressive monetary policy approach.