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Before Chair Powell speaks Friday, Wednesday the Fed releases minutes from July FOMC rate decision meeting. Lots of input goes into minutes and they may provide clues of policy direction before the important Jackson Hole speech.

Good PPI number but DC/ political policy world focuses on CPI which is released tomorrow at 8:30am. The number becomes a big story line for reporters and all news outlets.

Here is the Fed’s statement and I have taken language that I believe opens to door for potential cut in September. Source: Board of Governors of the Federal Reserve System https://search.app/P97qCYKdpA7Si2HGA The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

Next week’s meeting of the Fed’s FOMC seems likely to change the debate on interest rates with either a cut or a new statement indicating cuts are on the way, likely in September.

Reports are becoming widespread of President Biden’s apparent decline with Covid diagnosis. Landing in Delaware he had trouble both getting off Air Force One and getting into the car. Likely will not get in the way of Trump’s big night but big decision seems more likely, but not yet a done deal.

Chair Powell returns this morning to House Commitee for second day of his semiannual testimony. Same formal testimony but new questions. Having prepared questions for Members goal is to get your question on evening news. Always chance for news worthy exchange. Here’s Fed’s testimony link. https://www.federalreserve.gov/newsevents/testimony/powell20240709a.htm

Fed Chair Powell has finished his semiannual report to the Senate Banking Committee. Left all options open for future policy, more clues may come at July FOMC meeting. Here’s link to statement. Repeat tomorrow before House committee. https://www.federalreserve.gov/newsevents/testimony/powell20240709a.htm

FOMC minutes from May 1 meeting where rates were kept steady and Chair Powell said at presser he didn’t believe next rate move would be up. Always interesting to read comments that led to Chair’s comments. All participants give their input over the three weeks between meeting and release of minutes.

This morning the Democratic Caucus agreed to support the Speaker if MTG offers a Motion To Vacate (MTV). As I wrote in my Monday Fundstrat note in my many years as aide, lobbyist, and analyst I have never seen bipartisanship to support a Speaker. Many Republicans and Democrats are frustrated with the chaos that MTG and a few other Rs seem determined to push. Interesting political situation unfolding on Capitol Hill.

Senate to vote on a cloture motion on the Ukraine/ Israel military supp. Cloture ends any filibuster threat by limiting time for debate forcing a vote in no more than 30 hours. The only suspense is how many Rs will support the bill. In Feb. 22 Rs voted Yes, more expected today.