In a short 4.5-page testimony, Fed Chair Janet Yellen makes hawkish sounds, saying that the committee will evaluate the situation and perhaps raise rates in one of its upcoming meetings. Three rates hikes are possible with and in line with Fed forecasts. .
Yellen sees the jobs market with rosy glasses: wages are rising in jobs growth is widespread. She says that waiting too long to tighten would not be wise. However, the caveat is the normal warning that rates are not a preset course.
She says it is not her place to advise on fiscal policies but mentions that these should promote long-term growth and maintain a sustainable budget
The US dollar is higher across the board.
- EUR/USD traded at 1.0610 despite disappointing German growth. The pair fell to 1.0580.
- GBP/USD was around 1.2470, hit hard by weak UK inflation data. Cable experiences a small slide to 1.2460.
- USD/JPY traded slightly lower at 113.55. Dollar/yen leaps above 114.
- USD/CAD traded around 1.3040 amid rising oil prices following the OPEC Accord. Dollar/CAD is at 1.3080.
- AUD/USD enjoyed a mix of positive news and reached 0.7680. The pair slips to 0.7655.
- NZD/USD was stable around 0.7180 and 0.7155 afterward.
Fed Chair Janet Yellen is making her first testimony in front of the new Congress, under the Trump administration. This is the main event of the week. The prepared statement is released immediately with all the headlines flashing. She then reads it out and follows with answering questions, where more market moving remarks can emerge.
The US dollar has been mixed ahead of the event.
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