Day two on Capitol Hill: Fed’s Powell will likely repeat day one commentary

Fed’s Powell is likely to repeat most of what he said during his day one testimony in the Senate yesterday. The faces are different with House banking committee representatives providing the questions to the Fed chair:

• dual mandate has served us well.
• On the balance sheet runoff, the Fed has made quite a lot of progress but there still is a ways to go.
• It is hard to pick a precise stopping point but want a bit of a buffer. Going slower could allow them to go further
• Policy is currently restrictive. The neutral rate must have moved up at least in the short term.
• The fiscal path is unsustainable.
• Inflation caused by very strong demand and constrained supply.
• We have observed a waning of demand with increase in supply and inflation has come down.
• Economy is growing around 2%, it feels like and with inflation in jobs these are good numbers.

This article was written by Greg Michalowski at www.forexlive.com.