Market Extra: What stock-market investors want to hear when Fed’s Powell testifies before Congress this week

by | Mar 6, 2023 | Stock Market

The stock market’s bounce back from last year’s carnage will be again put to the test as investors closely listen to Federal Reserve Chairman Jerome Powell’s testimony before Congress this week for clues to just how high interest rates need to go to win the fight against inflation. Powell will deliver the latest semiannual report on monetary policy and the economy on Tuesday to the Senate Banking Committee and on Wednesday to the House Financial Services panel. Both hearings begin at 10 a.m. Eastern. Powell’s testimony will probably be his last public remarks before the next policy meeting of the Federal Open Market Committee, or FOMC, on March 21-22.  

See: Powell to talk to Congress about the possibility of more interest-rate hikes, not fewer Fundstrat’s head of research, Tom Lee, expects Powell to reiterate the “data dependence” message in his speech, affirming market expectations for another 25 basis point increase in the fed-funds rate at the March meeting. “Many ‘inflationistas’ are saying a 50-basis-point hike is needed because the January data was so ‘hot’ — that is the data reactivity of the bond and stock market, but we expect Powell to emphasize that rates are near neutral no …

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