Arabica coffee futures kick off the session attempting to close the gap left on the previous session at 174.95 and 175.10. Once it managed to build the momentum in the first three hours above 176, the small specs that added new shorts last minute yesterday opted to get out, adding to the fuel from the GCA report, which many could have taken as bullish. The European Central Bank hiked its benchmark interest rate by 50 basis points as promised this morning while giving no signals about future moves. China continues to expand its influence in the world after brokering a peace initiative between Iran and Saudi Arabia. It is now taking aim at brokering a peace deal between Russia and Ukraine. Certified stocks increase by 3,338 bags to 788,915 bags, while pending grading decreases by 9,683 bags to 475 bags. Grading today: 9,683 bags. Passed 4,653 bags. Failed 4,780.
Despite news of the Swiss National Bank stepping in to provide support for Credit Suisse, the Robusta terminal was slow to respond to the nearby macro positivity. Values opening only marginally higher before dropping $12 to $2057 basis March23, with pressure out of India noted as the main pressure off the opening bell. However, this move was short lived as early selling was absorbed as technical buying was uncovered at both the previous low and lower Bollinger band average, triggering a dynamic reversal higher to test back above $2110. The gains held through the remainder of the session as the early commercial short retreated, whilst momentum followers droved solid gains but at a slower pace than observed through the ‘C’ contract, which was reflective in the may23/may23 arbitrage narrowing 6 cents intraday to 85 cents.