Will Jerome Powell sound more dovish Thursday?
Market analysts around the world are bracing for another Capitol Hill appearance by the Federal Reserve chairman.
His testimony before the Senate Banking Committee — expected at 10 a.m. Eastern Time — comes after he made hawkish comments on Tuesday before a House panel.
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The new Fed boss on Tuesday highlighted ways that he personally thinks the economic outlook has strengthened, suggesting interest rates might rise faster than expected. His comments helped send U.S. stocks lower, while the dollar DXY, +0.13% and Treasury yields TMUBMUSD10Y, -0.60% jumped.
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Early Thursday, U.S. stocks SPX, -1.11% looked on track to open lower after a sharp selloff on Wednesday.
Here are some comments from analysts, as they sound off on what to watch for:
• “There has been a real negative shift in market sentiment since the Jerome Powell testimony a couple of days ago. Suddenly not only three, but perhaps even four hikes need to be priced in by the market, and this is impacting across global markets. ... It will be interesting to see if he dials back at all, considering the market reaction.” — Richard Perry, Hantec Markets analyst
• “Markets will be looking to see whether he rows back a little from Tuesday’s hawkish interpretation of his remarks or whether he reaffirms them. If he does the latter, then we could well see further gains for the U.S. dollar and increased pressure on stock markets.” — Michael Hewson, chief market analyst at CMC Markets UK
• “[The testimony is] unlikely to be much changed from earlier in the week, but some additional nuance could be gained.” — Alexandra Russell-Oliver, currencies analyst for Caxton
• “[Powell] is very unlikely to back pedal today, as the last thing he probably wants is to be labeled ‘unreliable’ after just two official appearances as the Fed chair.” — Charalambos Pissouros, senior market analyst at JFD Brokers