Breaking: Powell's prepared remarks are dovish – USD falls

Fed Chair Jerome Powell will tell lawmakers that uncertainties since the June FOMC meeting continue to dim the economic outlook. In this prepared remarks, the Fed says that it appears that concerns about the global economy will continue weighing on the domestic one and that the Fed will act as appropriate to sustain US economic growth.

He also notes that there is a risk that weak inflation will be persistent – more than the Fed currently anticipates. Housing and manufacturing have likely dipped again in the second quarter. Moreover, investments seem to have notably slowed down.

He still sees the labor market as strong and as staying as such and adds that the economy has mostly performed well. The baseline outlook remains for solid growth and a robust labor market.

The remarks are mostly dovish, starting with the dim outlook and continuing with the warning about low inflation.

We will be covering Powell's testimony live

The US dollar is falling across the board. EUR/USD has reached a high of 1.1245. GBP/USD is up to around 1.2500, and USD/JPY has dropped to 108.70. 

Powell was expected to confirm the Federal Reserve's intentions to cut interest rates by 25 basis points at the July 31st meeting as an "insurance cut" – only a one-off and not a series of reductions.