### POV, AVIAN LITMUS TEST FOR...>

US EURODLR FUTURES: ### POV, AVIAN LITMUS TEST FOR FED CHAIR POWELL MON/POL

TESTIMONY

- Is the new Fed chairman a hawk, is he a dove, or somewhere in between? Powell

is still getting his feet wet.

- Tuesday's House testimony earlier in the week spurred heavy selling across the

curve as the Fed chair was deemed more hawkish than his prepared text had come

across as. The Q&A session bore out an original opinion, however, w/Powell

saying incoming data suggests strengthening economy, confident "inflation

getting stronger". Rates reversed bounce, making new session lows.

- Thursday's testimony to the Senate may be offering a short term opportunity to

sell the short end -- partially elevated as pace of 3M LIBOR rise slows

(Eurodollar EDH8 futures +0.040). 

- Desks are trying to decide hawk/dove/moderate tone before committing to taking

on additional risk. Conundrum, Fed Powell states can't be "too aggressive" in

tightening policy w/inflation still below target -- But states that four hikes

WOULD be gradual. Get Back in there and Sell Mortimer!