Fed Chairman Powell's testimony, in a nut shell, supported a gradual FOMC
Fed Chairman Powell's testimony, in a nut shell, supported a gradual FOMC rate hike posture, and leaves the door open for more. His optimism on the economy, and his confidence regarding rising inflation following the fiscal stimulus earlier in the year, along with improved global growth, certainly underpin a 25 bp March tightening and at least a 3-dot plot when the estimates are released on March 21. While analysts see risk of a 4th rate increase this year, analysts don't expect the FOMC to alter it's forecast at this point. There are still several doves on the Committee, along with centrists who will want to maintain a "gradualist" profile for now. There's little need for the FOMC to play that card yet, but can instead make small increases to growth and inflation forecasts that will be revealed in the range estimates, though not necessarily the median forecasts.