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Fed Chair Jerome Powell two-day appearance on Capitol Hill will likely leave the door open to an interest rate cut at the end of July.   

Powell, who has been repeatedly pushed by President Trump in recent months to lower interest rate rate, is expected to remain in line with the Fed’s message from the June meeting: The economy is softening, the U.S.-China trade war is concerning and the case for a rate cut is growing.

The Fed chairman delivers his semiannual Monetary Policy Report at 10 a.m. Wednesday before the House Financial Services Committee and Thursday before the Senate Committee on Finance. Lawmakers, including Democratic presidential candidate Sen. Elizabeth Warren and Democratic New York Rep. Alexandria Ocasio-Cortez, will have the chance to question Powell about a number of issues, including monetary policy, the state of the economy and Trump’s attacks on the central bank.

Powell’s testimony comes on the heels of the better-than-expected June jobs report, the U.S. economy added 224,000 jobs, versus the expected 160,000 slightly tempering expectations for a rate reduction (The financial market is still pricing in a 100 percent chance of a rate cut, but only by 25 basis points). That’s because, even with a solid job growth number last month, the six-month job creation average is slowing down. The labor market is slowing down. 

Plus, the job's report is a lagging economic indicator, and the Fed is a forward-looking body tasked with monitoring other factors such as the yield curve. The spread between the 3-month and 10-year has been inverted for nearly seven weeks, worrying economists about the possibility of a recession.

Whether the Fed is truly an independent body is also likely to come up during questioning. Trump frequently lashes out at the central bank, and Powell, for raising interest rates too quickly in 2018. Last week, the president derided the Fed as the “most difficult problem” facing in the U.S. But, Fed Chair Jerome Powell has “worked the halls of Congress”, meeting with congressional leaders far more frequently than his predecessors.