There is relief for now as a deal to increase the U.S. Debt Ceiling was struck between U.S. President Joe Biden and House Speaker Kevin McCarthy on Sunday.

Ranulf Glanville, a Chief Market Analyst with GrainFox, says the deal prevents the United States from defaulting, meaning they wouldn’t be able to pay its bills.

However, Glanville says it will need to clear some hurdles, mainly votes in the House of Representatives and the Senate.

“My understanding is there is still a chance of considerable pushback, neither party really got what they wanted,” Glanville said of the Republicans and Democrats possibly calling for what they want out of the deal. “Certainly many hardline Republicans will be disappointed that spending is only being reduced by 0.2 percent, meaning effectively that the government of the United States continues to spend very freely under this agreement.”

He says news of the deal could yield a “relief rally” in the markets, while pushing the issue down the road for another two years.

“As long as the deal sticks then you’re back to trading other factors essentially, which is good news for the farm market, that’s what we want actually.

“If the debt ceiling deal gets derailed anytime in the next few weeks, then you’ll see more spasms of negativity in the stock market, the bond market, and that’ll likely spill over into the agricultural markets as well.”

Glanville expects the deal will be revamped over the next few weeks before it will pass.

“The U.S. government has a tendency to work through deals and add little sweeteners to get everybody that needs to be on board, on board, so I’d expect more negotiation before this gets passed.

“In terms of the U.S. actually defaulting I’m pretty confident that will be avoided because that’s really a no-win scenario for anybody.” added Glanville.