Futures slip ahead of Powell's testimony

Federal Reserve Board Chairman Jerome Powell testifies on Capitol Hill in Washington DC

Federal Reserve Board Chairman Jerome Powell testifies on Capitol Hill in Washington DC

In his testimony to the House Financial Services committee, Powell strongly signaled that the Fed would likely lower interest rates in the months ahead in part because trade disputes and a slowing global economy have created clouds of "uncertainty" that are weighing on the USA economy. The S&P 500 index briefly traded over 3,000 for the first time.

Mr Powell, giving evidence to a hearing in Washington, has come under pressure from Donald Trump to cut rates. And he must do this all without admitting that the Fed misread the economy when it hiked rates past year. As the economy recovered the central bank began slowly raising rates. "Obviously it is complicated by the fact that the president has called for rate cut but we still see indications that uncertainty is starting to be a drag on the economy", he said.

Minutes from the last Federal Open Market Committee meeting, held mid-June, are scheduled to be released at 2 p.m. ET. However, after he's spoken, there is now a 100% chance of a 25-bps rate cut, and a 28% chance of a 50-bps rate cut at the July Fed meeting. But he did thank Congress for the "independence" it has given the central bank to operate free of political intrusion.

Waters and other Democrats urged Powell to stand up to Trump's attacks. But later, in the question-and-answer period, several Democratic committee members offered support for Powell's leadership and a rejection of Trump's criticism.

Wall Street is all but certain that the end of the Federal Reserve's three-year hiking campaign is here. "We in Congress, both Democrats and Republicans, have got your back". But as clearly demonstrated by Powell's testimony Wednesday, the Fed is not joining the #resistance.

David Marcus, Facebook's blockchain lead and the head of Calibra, a subsidiary which will build a digital wallet for the cryptocurrency, responded to some questions by the Senate Banking Committee on Tuesday.

NASA awards SpaceX $50 million contract for new mission
The spacecraft will measure the polarization of X-rays from a variety of sources, from pulsars to active galactic nuclei. The spacecraft was supposed to launch in 2017 but due to some series of issues, the mission didn't continue.

At the moment, the economic landscape is a mixed one: The U.S. job market appears resilient but overall economic growth is slowing with many forecasters predicting growth has slowed to around 2 per cent in the just completed April-June quarter.

Powell said any regulatory review of the project should be "patient and careful".

"Apparent progress on trade turned to greater uncertainty, and our contacts in business and agriculture reported heightened concerns over trade developments", Powell said, noting that business investment, an important component of economic growth, "seems to have slowed notably" in the last few months. But with unemployment at close to record lows and the USA economy showing continued strength, the Fed left rates unchanged at it's last meeting.

Powell repeated a pledge the Fed made in its June policy statement that officials would "act as appropriate to sustain the expansion". However, he added that "many" Fed official saw that the case for a looser monetary policy "had strengthened". Trump and Chinese President Xi Jinping declared a truce last month in what had threatened to become an escalating U.S.

His testimony specifically cited risks associated with trade conflicts (read: the US-China trade war) and lagging growth indicators in the global economy.

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