Yellen Testimony: Expect a balanced message – RBC CM

Adam Cole, Research Analyst at RBC Capital Markets, suggests that the main focus outside the UK will be Fed chair Yellen’s semiannual testimony to the House Banking Committee (followed by the Senate equivalent tomorrow).

Key Quotes

“In the wake of the recent FOMC meeting and Yellen’s post-meeting press conference, it is hard to imagine that her testimony to Congress will differ at all from the message she just conveyed about the backdrop. While the net result of the FOMC meeting was perceived as dovish, that was almost entirely a function of the shift lower in their “dots” (i.e., committee members’ assessment of appropriate monetary policy). The reality is that if one just isolates Yellen’s message, she was not particularly dovish. Our economists expect a similar, balanced message during her upcoming testimony.”