U.S. futures lost ground on Tuesday ahead of what investors expect to be a hawkish speech by Federal Reserve Chair Jerome Powell. The speech is set to be delivered at 9 a.m. ET and is expected to indicate little change in the central bank’s strict interest rate policy.
Michael Matousek, head trader at U.S. Global Investors Inc in San Antonio aired his belief that Powell will state that inflation remains a pressing issue and that raising interest rates will remain a priority until inflation is suppressed.
Futures listed on the Dow Jones declined 0.48% during early trading, while those on the S&P 500 and the tech-heavy Nasdaq Composite experienced losses of 0.50% and 0.69% respectively.
Aside from Powell’s expected remarks, last week’s data showing moderation in wage increases extinguished investors’ hopes that United States inflation had peaked and that a looser central bank monetary policy would be adopted shortly.
Following the Federal Reserve chair’s speech investors will look toward U.S. Labor Department’s consumer prices report on Thursday, which is expected to indicate a moderation in changes to year-on-year prices over December.
