The main event is Bernanke’s semi-annual testimony to the Congress where focus will be on hints about when the Fed will start scaling back its bond buying. While the statement may not add much new information compared to what was revealed in the latest Fed minutes, the Q&A session will be followed closely. Bernanke will probably be asked what is needed for the Fed to start tapering in September. Questions are likely to touch upon the labour market following the strong job report in June as well as whether the Fed’s concern about the low level of inflation has diminished with the higher figure for CPI in June, see WSJ. The testimony is particularly interesting as it is the Fed’s best communication opportunity for some weeks, since there is no press conference planned for the July FOMC meeting.
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