Markets are not waiting for Powell’s comments, as early-year rate reduction chances fade.

The bond market is prepared for a more hawkish monetary policy with higher-for-longer rates.

The 10-year Treasury yield reached its highest level since 2007 on Monday, amid concerns that Powell may raise the neutral rate.

The median neutral rate of interest was predicted in June, but hasn’t changed since 2019.

Some advocate for a higher neutral rate to restrict policy and curb growth and inflation.