According to testimonies prepared for delivery at the hearing before the House Financial Service Committee on Tuesday, the chairman of the Federal Reserve Jerome Powell will repeat that the increased tariffs will probably augment inflation and consider business activity.
Key results from the testimony of the chairman of Fed Powell
“For now, it is well prepared to wait to learn more about the likely course of the economy before adapting the policy.”
“The economy is solid despite increased uncertainty.”
“Almost full employment, inflation slightly above 2% target”.
“They took the risk on both sides of the Fed mandate.”
“A strong labor market helped to sniff demographic differences in earnings, employment.”
“The Fed duty is to prevent a one -off price increase in the price of inflation by maintaining well -demanded inflation expectations.”
“To satisfy this obligation, he will balance finances related to employment and price stability.”
“Without price stability, it cannot reach long periods of strong labor market conditions.”
Market reaction to the testimonies of the chairman of Fed Powell
The American dollar index (USD) remains in the lower half of its daily coverage near 98.00, losing about 0.3% during the day.
The price of the American dollar today
The table below shows a percentage change in the US dollar (USD) compared to the main vital currencies. The American dollar was the weakest in relation to the dollar of New Zealand.
| USD | EUR | GBP | JPy | BOOR | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.25% | -0.59% | -0.81% | -0.15% | -0.76% | -0.87% | -0.42% | |
| EUR | 0.25% | -0.37% | -0.57% | 0.10% | -0.50% | -1.05% | -0.16% | |
| GBP | 0.59% | 0.37% | -0.22% | 0.48% | -0.12% | -0.68% | 0.07% | |
| JPy | 0.81% | 0.57% | 0.22% | 0.67% | 0.01% | -0.10% | 0.27% | |
| BOOR | 0.15% | -0.10% | -0.48% | -0.67% | -0.62% | -1,15% | -0.41% | |
| Aud | 0.76% | 0.50% | 0.12% | -0.01% | 0.62% | -0.55% | 0.21% | |
| NZD | 0.87% | 1.05% | 0.68% | 0.10% | 1.15% | 0.55% | 0.75% | |
| CHF | 0.42% | 0.16% | -0.07% | -0.27% | 0.41% | -0.21% | -0.75% |
The heat map shows percentage changes in the main currencies towards each other. The basic currency is collected from the left, and the quote currency is collected from the upper order. For example, if you choose an American dollar on the left column and move along the horizontal line to Japanese Jen, the percentage shift displayed in the field will represent USD (base)/JPy (quote).
In this section below was published as a preview of the testimony of the chairman of Fed Powell at 10:00 GMT.
- The Jerome Powell certificate in the US Congress will be an event with the highest level this week.
- New tips on the Federal Reserve interest rate are expected.
- American dollar, stock market markets and other asset classes could see huge swings with the words of the Fed chair.
Jerome Powell, chairman of the United States Federal Reserve (USA), will provide a six -month monetary policy report and testify on Tuesday before the US financial services committee. The trial will start at 14:00 GMT and bring full attention to all players on the financial market.
Jerome Powell is expected to take care of the main dishes for the semi -annual monetary policy report of the federal reserve, published last Friday. In this report, the Fed noted that there are some early signs suggesting that the tariffs are increasing inflation and repeated that monetary policy is well prepared for what is waiting.
During the long session of questions and answers, the members of the Chamber will ask Powell about the path of interest rates, inflation development and economic perspectives. It is also very likely that US President’s policy Donald Trump and the current geopolitical environment can affect prices, growth prospects and monetary policy.
The CME Fedwatch tool shows that the markets are currently valued in about 20% probability that the FED will reduce the rate of rules by 25 base points (BPS) in July after maintaining the status quo at each meeting this year. The changed summary of economic forecasts (SEP), published together with a political statement after the June meeting, showed that decision -makers still forecast two 25 points of the base point (BPS) in 2025 and a reduction in a single rate in 2026, compared to the two stakes specified in sep marc.
In an interview with CNBC last Friday, Fed Christopher Waller Governor said that the Fed is able to lower the rates in July. Referring to signs on the labor market, such as the high unemployment rate among recent graduates and slower job creation, Waller argued that the Fed should not wait for the labor market failure before alleviating the policy. Similarly, Fed Governor Michelle Bowman noticed that she would talk about lowering the interest rate at the next meeting to more precisely adapt the policy with its neutral environment and maintain a vigorous labor market.
In the event that Powell notes that they will not have enough data to confirm the reduction in the rate in July and repeats that they must remain patient, market positioning suggests that the US dollar (USD) may accumulate strength in relation to his rivals in immediate reaction. On the other hand, you can see a significant USD sale if Powell leaves the door in politics in July. Comments on the perspectives of inflation, especially with rising energy prices due to the escalation of geopolitical tensions in the Middle East, can also augment USD valuation.
About Jerome Powell (via federalreserve.gov)
“Jerome H. Powell for the first time took the office as the chairman of the Council of Governors of the Federal Reserve System on February 5, 2018 for a four -year term. He was again appointed to office and sworn in for the second four -year term of May 23, 2022. A member of the Governors’ Council, since she covered the governor, from May 25, 2012, in 2012, in 2012, in 2012, fill out the deadline.
