Powell's testimony - key takeaways

Fed Chair Powell started the second session of semi-annual testimonies before Congress. Below we will present some key takeaways from  the Q&A session: 

• I stress that no decision has been made on the pace of rate hikes.

• The terminal rate is likely to be higher than we expected.

• The extraordinary strength of the jobs report and the inflation report both pointed in the same direction.

• We have not made a decision about the March meeting and it is data dependent.

•  We have critical information before the March meeting.

• No one should believe the Fed can protect the economy in the event of a debt default.

• Congress would have to approve retail CBDC

• We've had our eyes on the whole housing inflation thing from the beginning

• Regarding the transitory mistake says 'if we ever see this pitch again, we'll know how to swing at it'

• The cost of failure to control inflation would be extremely high

• China faster reopening isn't expected to be a big net effect on the US

• We expect China's impact to be moderate overall

• Notes that oil prices could be affected by China reopening and notes that it's more of a concern for Europe

• Lower housing inflation is a big reason everyone thinks inflation will go down

US500 rebounds from daily lows and approaches psychological 4000 pts level. Source: xStation5