U.S. stock index futures inched lower on Monday as investors awaited Federal Reserve Chair Jerome Powell’s testimony and monthly payrolls report this week for cues on the central bank’s interest-rate trajectory.
The three main U.S. stock indexes rallied on Friday and notched weekly gains as Treasury yields pulled back from their peaks after comments from Fed policymakers calmed jitters over aggressive rate hikes.
The yield on U.S. 10-year Treasury notes slipped to 3.92%, its lowest since March 1, while the two-year yield inched down to 4.85% after touching its highest since 2007 last week.
Powell will be testifying before Congress on Tuesday and Wednesday and investors will watch for clues on the policy outlook, after recent strong economic data and hot inflation numbers fueled bets for more interest rate hikes this year.
“Looking at the latest set of data, the U-turn of easing inflation and last month’s blowout jobs figures, we don’t expect to hear anything less than hawkish from Mr. Powell,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
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