The Federal Reserve speaker parade continues on Tuesday. What to watch for

<p>The comments from Federal Reserve Chairman Jerome Powell on 60 Minutes set the tone for the week. I don't think he said anything new but there was plenty of talking… and there is plenty more to come.</p><p>I strongly suspect the Fed could live with its current messaging and Fed funds futures pricing in a 16% chance of a March cut and 115 bps this year. They're in a clear wait-and-see mode but — alas — there's no 'mute' button at the Fed.</p><p>On Monday, we heard from Goolsbee (non-voter) and
Kashkari (non-voter). Goolsbee took a dovish tone and said “if
we just keep getting more data like we've gotten… we should be well on the path
to normalization.” </p><p>However in an essay, Minneapolis Fed President
Kashkari wrote that “It is possible, at least during the post-pandemic
recovery period, that the policy stance that represents neutral has increased.”</p><p>I'm not sure how much weight the word 'possible' is carrying there but the only interpretation there would be hawkish.</p><p>The day ahead features:</p><ul><li>Mester – Noon ET (1700 GMT)</li><li>Kashkari 1 pm ET (1800 GMT)</li><li>Collins 2 pm ET (1900 GMT)</li><li>Harker 7 pm ET (0000 GMT)</li></ul><p>The market is clearly more concerned about hawkish rhetoric at the moment and that may be because of looming 10-year and 30-year auctions on Wed, Thurs. However the momentum is clearly higher in the dollar and yields so that's a tough fade, at least until some data disappoints or CPI benchmark revisions on Friday are lower.</p>

This article was written by Adam Button at www.forexlive.com.