WHAT TO EXPECT FROM POWELL? At 0900ET Fed.......>

FED: WHAT TO EXPECT FROM POWELL? At 0900ET Fed Chair Powell gives "An Economic

Update" followed by a discussion with Peterson Institute president Adam Posen.

- There will be a text released, and Q&A afterward.

- Expect him to reiterate lines from the April FOMC: Fed has done lots already

and is ready to do more using full range of tools... and not in a hurry to

tighten. Will delineate fiscal from monetary policy, and loans vs grants.

- Likely to discuss balance sheet moves / market functioning. Though not sure

there's much more to say on the economic outlook vs what was said in April.

- Also likely to dismiss negative rates as a tool under consideration, as he has

done on previous occasions in 2020. Anything less would embolden NIRP talk.

- If Powell doesn't do it in prepared remarks, it's likely to come in the

discussion: Posen has previously argued that negative rates are "just another

policy tool" and would be more effective in the U.S. than in Japan and other

large economies, so the stage is set.

- In other words, if it's not in the text and there is a knee-jerk dovish

reaction, it will likely fade in the Q&A as Powell talks down -ve policy.