– USD Strength is continuing and prices look poised to test the February high as we near the close of the month. Yesterday’s strength continued following the testimony from Mr. Jerome Powell, in which markets inferred the possibility of four rate hikes this year given strength in the US economy. This has also brought back some pressure into equities, and those prior trends of EUR/USD and GBP/USD strength are taking some hits as deeper support levels come into play.
– Mr. Powell takes the stage again tomorrow morning when he testifies in front of the Senate Banking Committee; and if we do see yesterday’s equity sell-off continue to break through support, fully expect ‘stocks in turmoil’ to be a headline theme tomorrow ahead of that testimony. This will likely elicit some questions from Congress to the regards of monetary policy and QE or perhaps even forecasts around rate hikes or forward guidance. All of which could make tomorrow’s testimony considerably more interesting than many of the questions that came from the House Financial Services Committee yesterday.
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