Here's What Experts Expect Bernanke To Say When He Speaks To Congress On Wednesday

thenews 2013.07.17 04:19

Federal Reserve Chairman Ben Bernanke heads to Congress to speak to the House Financial Services Committee on Wednesday at 10:00 a.m. ET and then to the Senate Banking Committee on Thursday at 10:30 a.m. ET.

This will be Bernanke's 16th so-called Humphrey Hawkins testimony.

The world will be listening very carefully for any new clues regarding the direction of monetary policy.

In particular, everyone will want to know 1) when the Fed could begin to taper its monthly purchases of $85 billion dollars worth of bonds and 2) when it plans to start hiking its benchmark interest rate, which is currently near 0%.

Anything could potentially rock the markets.

Here's what the experts are saying (emphasis added):

Neal Soss, Credit Suisse:

"Bernanke probably will not dissuade the markets of the notion that a tapering is likely as soon as September. But his comments may sound dovish as he reiterates that any change in the size of asset purchases is dependent on the economic data and on financial market conditions.
The run-up in yields in recent weeks, for example, practically demands that Bernanke comment specifically on the risks posed by tighter financial market conditions. He may also focus on the risk of lower-than-desired inflation...

...We assume this will be Bernanke's final semiannual testimony. Will he reveal his intentions regarding a third term? Possible, but not probable."