MUFG Research highlights the 2 key market movers for the USD this week.

"The two main potential triggers for further gains in the week ahead will be the semi-annual monetary policy testimony from Fed Chair Powell in Congress on Tuesday and Wednesday, and then the release of the latest NFP payrolls report on Friday," MUFG notes. 

"Market participants will be scrutinizing Chair Powell’s comments closely to assess if he is becoming more open to the idea of raising rates more than a couple of further times this year in response to the stronger activity and inflation data at the start of this year. 

Market expectations for the Fed’s terminal policy rate have risen by just over 70bps since the January NFP report was released on 3rd February. Another blowout NFP report is highly unlikely in the week ahead. Employment had been increasingly strongly by an average of 315k/month in the previous five months 3 6th March 2023 even before January’s blow out gain of 517k," MUFG adds.