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Deutsche Bank analysts point out that Fed Chair Powell is due to make his semi-annual monetary policy testimony before the House Financial Services Committee at 3pm BST this afternoon (10am EDT) and will be main event for markets.

Key Quotes

“In the past the testimony had largely adhered to the outcomes of the latest FOMC meetings and on that we’re due to receive the latest FOMC minutes after Powell’s testimony.”

“Our colleagues expect Powell to reiterate the relatively upbeat assessment of the labour market but if questioned more closely about the underlying details, they would not be surprised if Powell were to sound a mild note of caution about the recent downshift in hours worked.”

“As for inflation, they expect Powell to reiterate the same concerns the FOMC highlighted at the last meeting, namely wage growth and weaker global growth holding down inflation around the world.”