U.S. Federal Reserve Chairman Jerome Powell will again be in the spotlight this week when he addresses Congress after the largest interest rate hike by the nation’s central bank since 1994. Powell’s comments and those of several other Fed officials due to speak this week will be closely watched as the market tries to gauge the size of the expected rate hike at the Fed’s upcoming July meeting. The U.S. economic data calendar is modest, but updates on the state of the housing market will be in focus amid signs of a rapid cooling. European Central Bank Governor Christine Lagarde is scheduled to address the European Parliament on Monday and answer questions about the bank’s new anti-crisis tools. Meanwhile, stock market volatility looks set to continue along with the fall in cryptocurrencies. Here’s what you need to know at the start of this week.

1. POWELL’S SPEECHES

Powell is scheduled to address Congress at hearings on Wednesday and Thursday and is expected to reiterate the Fed’s commitment to curbing inflation, which is at its highest level in 40 years.

The Fed on Friday said its commitment to fighting inflation is “unequivocal.” Annual U.S. inflation in May rose at the fastest pace since 1981.

The Fed raised rates by 75 basis points last Wednesday and noted a faster pace of future rate hikes. Powell said the Fed can’t control all the factors contributing to inflation, such as the conflict in Ukraine, which have driven up energy prices.

Market participants fear that the Fed’s tight path of rate hikes carries the risk of pushing the economy into recession, and with signs of a slowing economy and U.S. stocks now in bear market territory, Powell may be required to provide more details on how the Fed can curb inflation without causing too much disruption to the economy and the market.

2. LAGARD SPEECHES

ECB chief Christine Lagarde is due to address the European Parliament in Brussels on Monday and is likely to be questioned at length about progress on the bank’s new crisis toolkit since it was announced last week.

The ECB is drawing up plans for a new buying scheme aimed at tackling “fragmentation”, or the widening gap between the cost of borrowing paid by Germany and larger debtors on the eurozone periphery such as Italy, Spain and Greece.

Government borrowing costs have risen sharply in the eurozone periphery since the ECB announced plans earlier this month to raise interest rates to combat inflation, which is currently above the ECB’s 2% target.

The market is currently pricing in a 25 basis point ECB rate hike in July and at least one 50 basis point hike by September, and some analysts believe the new tool could allow the central bank to implement a steeper rate hike if necessary.

3. ECONOMIC DATA FROM THE U.S.

There are few events on the economic calendar this week, and the focus is on the US housing update. As expected, Tuesday’s data on

U.S. Federal Reserve Chairman Jerome Powell will again be in the spotlight this week when he addresses Congress after the largest interest rate hike by the country’s central bank since 1994. Powell’s comments and those of several other Fed officials scheduled to speak during this week will be closely watched as the market tries to gauge the size of the expected rate hike at the Fed’s upcoming July meeting.

The U.S. economic data calendar is modest, but updates on the state of the housing market will be in focus amid signs of a rapid cooling. European Central Bank Governor Christine Lagarde is scheduled to address the European Parliament on Monday and answer questions about the bank’s new crisis management tools. Meanwhile, stock market volatility looks set to continue along with the fall in cryptocurrencies. Here’s what you need to know at the start of this week.

4. STOCK MARKET VOLATILITY

Last week, each of Wall Street’s three major indexes fell for the third straight week due to concerns about the growing likelihood of a recession as the Fed and other global central banks try to suppress inflation.

The benchmark S&P 500 index is down about 23% since the start of the year and recently confirmed that a bear market began on Jan. 3. The Dow is also on the verge of confirming its own bear market.

“You’re going to see a lot of volatility now, and that’s primarily going to be due to the fact that the Fed is going to be planning all these rate hikes and just trying to assess the inflation picture, and it’s still very hazy,” Megan Horneman, director of portfolio strategy at Verdence Capital Advisors in Hunt Valley, Maryland, told Reuters.

“Just expect volatility, it’s already there and it will continue until we get a little more clarity on whether inflation has really peaked.”

U.S. stock indexes will be closed on Monday, June 20.

5. “CRYPTOSIMA.”

Bitcoin was trading at around $19,571 last Sunday after falling to a low of $17,593 on Saturday – its weakest level since December 2020.

It has lost about 60% of its value this year, while etherium, a rival cryptocurrency, has fallen 74%. Bitcoin hit over $68,000 in 2021.

“The $20,000 gap shows that confidence in the crypto industry has collapsed and that the latest stress is being seen,” Edward Moya, senior market analyst at OANDA, told Reuters in an interview on Saturday.

Moya said that “even the loudest crypto-enthusiasts of the big rally times are silent right now. They are still optimistic about the long term, but they are not saying now is the time to buy on the dip.”

The cryptocurrency sector has been hit by growing signs of stress across the industry following the Terra blockchain crash last month. Earlier this month, credit card company Celsius froze withdrawals and transfers between accounts, and cryptocurrency companies began laying off employees. Cryptocurrency hedge fund Three Arrows Capital said last week that it suffered heavy losses.

This collapse coincided with a sell-off in stocks, which could further erode investor confidence in the crypto industry.

markets will show a slowdown in May as mortgage rates continue to rise. On Friday, U.S. new home sales data will be released as the market awaits signs of recovery from May’s 16.6% drop.

Initial jobless claims data is due on Thursday after last week’s data indicated some cooling in the labor market, although conditions remain tight. Preliminary data on activity in the manufacturing and services sectors are also due on Thursday.

Meanwhile, several Fed officials including James Bullard, Thomas Barkin, Charles Evans and Patrick Harker are scheduled to speak during the week.

This collapse has coincided with a sell-off in stocks, which could further undermine investor confidence in the crypto industry.