US Dollar Index closed the first two days of the week in tremendous territory. Fed Chair Jerome Powell will share his ideas on the financial system and labor market at the Brookings Institute today. Economists at DBS Bank assume Powell to realign markets to the Fed’s costs trajectory.
Powell will stress that prices will solely pause in 2023
“Powell will stress that costs will solely pause in 2023 and remind markets that the Fed has but to begin an interior debate on the place and when fees will peak. Powell have to reaffirm the Fed’s intention to raise the 2023 goal for costs from the 4.6% pencilled in September in subsequent month’s Summary of Economic Projections.”
“If Powell realigns the market to the Fed’s fee trajectory, the UST 10Y yield ought to upward jostle above 4% once more and pull the USD higher.”