Futures edge higher ahead of Fed Chair Powell’s testimony
U.S. stock index futures edged higher on Tuesday, ahead of Federal Reserve Chair Jerome Powell’s testimony before Congress that could shed more light on the central bank’s plans for raising interest rates.
The benchmark S&P 500 (.SPX) closed higher for a third straight session on Monday, as Treasury yields took a breather from their recent rally that was driven by expectations of the Fed holding interest rates at a higher level than many had expected at the start of the year.
Powell will testify before the Senate Banking Committee at 10:00 a.m. ET (1500 GMT), with investors focused on whether he remains confident about the Fed’s moves for bringing inflation towards its 2% target.
Powell said at his last press conference that a “disinflationary process” had begun, while cautioning the central bank’s fight against rising prices was not over.
Inflation data since Powell’s Feb. 1 remarks has shown prices have not fallen by as much as analysts were expecting, while the labor market has shown signs of resilience.
“We expect Mr. Powell to reiterate that further rate hikes are needed and, if the data were to continue to surprise to the upside, the peak rate would likely need to be higher than the central bank had previously expected,” Unicredit analysts said.
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