- The U.S. economy will focus on the Fed Chair Yellen's testimony on Wednesday, the retail data on Friday, and will await President Obama's budget proposal to the Congress
After the unemployment rate fell below five percent for the first time since 2008 for January, the U.S. economy and stock market will focus on the Federal Reserve's (Fed) testimony to Congress on Wednesday.
The U.S. unemployment rate fell to 4.9 percent for January, and the economy added 151,000 new jobs during that month, according to the Bureau of Labor Statistics Friday. However, the new jobs added, also known as non farm payroll, was below market expectations.
Both unemployment rates and nonfarm payrolls are significant indicators for the U.S. economy that the Fed watches closely for its decision on interest rate changes.
Yellen's testimony before the Joint Economic Committee of the U.S. Congress includes economic outlook of the country and the current monetary policies, and it could create high volatility in the market depending on its content.
The U.S.' Energy Information Administration will announce its weekly crude inventories also on Wednesday. Last week, the EIA announced that crude stocks in the country rose by 7.8 million barrels for the week ending Jan. 29. A higher than expected inventory rise could push down oil prices even further, which are hovering around $30 per barrel, and around 75 percent less than their mid-2014 value.
U.S. President Barack Obama is also expected to announce and send its final budget proposal that includes a $10 fee on every barrel of oil produced in the U.S., to be paid by oil companies. The fee would be gradually phased in over five years.
Obama aims to use the fund to finance research and development investments of clean energy and for the transportation infrastructure in the country to wean the U.S. economy off its dependence on oil consumption to a certain extent.
By Ovunc Kutlu in New York and Gulbin Yildirim in Washington, D.C.