Powell will testify before Congress next week, and interest rate cuts will be the focus
Powell will testify before the Senate Banking Committee at 10 a.m. Eastern Time next Tuesday, and the following day he will testify before the House Financial Services Committee. It is worth mentioning that this is his first time answering questions from congressional members since July of last year
Powell is set to face Congress for the first time this year, with statements regarding the timing of interest rate cuts becoming a focal point for the market.
Federal Reserve Chairman Powell will attend a congressional hearing next week. According to an announcement from the Federal Reserve on Thursday, Powell will testify before the Senate Banking Committee at 10 a.m. (Eastern Time) next Tuesday, and the following day he will testify before the House Financial Services Committee.
It is worth mentioning that this will be his first questioning by congressional members since July of last year.
The Federal Reserve cut interest rates by a total of 100 basis points in three meetings before the end of last year, and in January, the Federal Reserve voted to keep the interest rate unchanged in the range of 4.25%-4.5%.
At the January press conference, Powell stated that the Federal Reserve is not in a hurry to further cut interest rates. Tim Duy, chief U.S. economist at SGH Macro Advisors, pointed out that this week Federal Reserve officials have reached a consensus on Powell's cautious stance and hinted that no action will be taken before the second half of this year.
Trump has recently toned down his criticism of Powell and the Federal Reserve. Last Sunday, Trump stated that the Federal Reserve's pause on interest rate hikes is "the right thing to do."
U.S. Treasury Secretary Scott Bessent previously stated in an interview with Fox Business that Trump is more focused on long-term rates rather than the Federal Reserve's short-term rates. He said, "He and I are both focused on the 10-year Treasury yield."
Additionally, Federal Reserve officials indicated that a weakening labor market could become one of the reasons for reconsidering interest rate cuts. According to media surveys, it is expected that 169,000 non-farm jobs will be added in January, with the unemployment rate remaining unchanged at 4.1%. Tim Duy believes that if the employment report meets expectations, it will encourage Federal Reserve officials to maintain their current stance