FX.co ★ Cotton Futures Edge Lower

Cotton futures hovered near 78 cents per pound after briefly slipping toward 77 cents, with recent moves in prices driven largely by short covering. A firmer U.S. dollar pressured the market after Federal Reserve officials signaled a more hawkish policy stance, undermining the competitiveness of U.S. cotton in export markets. Additional downside came from weaker crude oil prices, which make synthetic fibers relatively cheaper and more competitive against cotton. Overall crop conditions remain broadly favorable, but investors are closely watching weather patterns across key U.S. growing regions heading into July, as some areas face excessive rainfall while others contend with emerging drought risks. Certified cotton stocks remain ample, suggesting little threat of a delivery squeeze and helping to keep broader supply concerns contained.