We said to expect nothing [3]from the Chairman today. We were right (and those "strategists" who said to look for a negative IOER announcement were dead wrong). And now, here is Goldman with its Humphrey Hawkins post-mortem.
Bernanke's Congressional Testimony: Noncommittal
BOTTOM LINE: Chairman Bernanke does not break new ground relative to previous FOMC communication in his prepared remarks to Congress.
MAIN POINTS:
1. Chairman Bernanke sticks closely to the information conveyed in the June FOMC statement and minutes in his prepared remarks to Congress. His description of the economy is mainly factual and he reiterates that the committee is "prepared to take further action" but does not provide any discussion of the available easing options.
2. The Chairman spent more time than usual on downside risks. First, he discusses in some detail the risks associated with the European crisis. Second, he stresses the downside risks associated with the US fiscal outlook and argues that the uncertainty might already be weighing on the economy at present.