###POV: WHAT TO WATCH FOR FROM POWELL: The......>

FED: ###POV: WHAT TO WATCH FOR FROM POWELL: The June payrolls figure last Friday

priced out a 50bps July FOMC cut - effectively removing the need for Powell to

push back on such aggressive market pricing at today`s hearing.

- But 25bps is still very much priced in for July, and as has been widely

discussed, the Fed always follows through on 100% market pricing (since 1994 at

least, per Bianco Research, based on pricing within 35 days of FOMC).

- Hard to see Powell pushing back hard on 25bps, despite decent data of late.

- So focus probably on further easing. Dot Median is for 50bps in 2019 cuts.

- CME FedWatch now sees 17% of just 25bps of 2019 cuts; 42% 50bps; 41% >50bps.

- Note Powell in June stressed `crosscurrents`, esp global growth, drop in bus.

confidence, muted inflation. Plus noted weak May jobs. Arguably an improvement

since then esp on domestic data (ISM, Payrolls).

- If Powell goes heavy on `data dependence` talk, would be regarded hawkish.

- Thursday's Senate Q&A could be even more market-moving than Wednesday`s, if

there is a Jun CPI data release surprise (0830ET Thurs).

- Don't forget about the Minutes (1400ET), esp re Dot plot change rationale.