Attention Turns to Fed Chair Powell’s Congressional Testimony

All Eyes on Fed Chair Powell’s Congressional Testimony

02.03.2022

U.S. currencies traded relatively firmly the previous day, with the GBP/USD pair falling by about 130 pips from 1.343 to 1.330.On the daily chart, the GBP/USD pair has clearly broken below its previous high and is falling rapidly toward this year’s low of 1.316; therefore, we should keep a close eye on whether it breaks below that level, just to be safe.Meanwhile, the U.S. ISM Manufacturing Index for February, released yesterday, came in at 58.6—up 1 point from the previous reading and exceeding market expectations of 58.0.

Among European currencies, the euro has been trading weakly amid the worsening situation in Ukraine, which shows no signs of abating; the euro/dollar pair fell by approximately 150 pips from 1.123 to 1.108.The EUR/USD pair has already hit a new low for the year, and if it breaks below 1.108 with a real body candle, there will be no major support until around 1.088, so we need to keep a close eye on the direction of the market.

Today, during European trading hours, the UK Nationwide House Price Index will be released at 16:00, followed by Germany’sunemployment rate at 17:55, the Eurozone Consumer Price Index at 19:00, and the U.S. MBA Mortgage Applications Index at 21:00, followed by the U.S. ADP National Employment Report at 22:15 during U.S. trading hours, remarks by U.S. Federal Reserve Bank of Chicago President Evans at 23:00,remarks by Chicago Fed President Evans, at 23:30 remarks by U.S. St. Louis Fed President Bullard, at 24:00 the Bank of Canada’s policy rate and statement, testimony by U.S. Federal Reserve Chair Powell before Congress, at 24:30 U.S. weekly crude oil inventories,at 27:30, remarks by MPC Member Tenreyro; and at 28:00, the U.S. Federal Reserve’s Beige Book. I plan to keep a close eye on the direction of the U.S. dollar while paying close attention to Fed Chair Powell’s remarks today.