The Fed is by far not the only central bank to adopt a more hawkish tone: global bond yields are rising on the back of expectations of monetary tightening by most central banks, as most of the world's economies are recovering and getting strong enough to withstand a reduction in monetary policy support. The broader All Shares declined by 0.04 percent or 1.73 points to finish at 4,735.12.
US stock indexes were mostly lower in afternoon trading Tuesday as losses among banks and other financial companies outweighed energy sector gains.
Revenues rose two percent to US$15.7 billion.
"No doubt the Fed Chairman's tone and assessment of the latest jobs report against the backdrop of more recent market reactions will also be among the key focus", writes Stifel economist Lindsey Piegza on Monday.
"I think the increased hawkishness we have seen from the central banks has led to a fear that we could see a mini-taper tantrum", he said.
The ICE Dollar Index, which measures the dollar against a basket of six currencies, was 0.1% higher, at 96.13. Investors will look for clues as to how aggressively the Fed will continue to raise rates and start to unwind its big bond-buying program.More news: British hope into Wimbledon semi-finals
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The Canadian dollar fell against its United States counterpart as oil prices fell and traders await an interest rate hike decision by the Bank of Canada on Wednesday.
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CURRENCIES: The dollar fell to 113.84 from 114.05 yen late Monday.
The Group of 20 meeting in Hamburg over the weekend did not have much impact on markets on Monday. The Russell 2000 index of smaller-company stocks rose 2 points, or 0.2 percent, to 1,411.
Regional markets will take cues on how the USA economy is performing and whether the Fed will undertake new policy moves, she added. The rand was also softer against the euro (R15.51) and the pound (R17.53).
Dollar bulls are banking on Yellen to retain her hawkish stance, emboldened by last Friday's relatively robust US non-farm jobs report."The main focus is whether Yellen makes it clear in Congress that the Fed intends to begin winding down quantitative easing". The productivity slowdown, found not just in the USA but also other advanced economies, reflects a combination of factors, perhaps a "productive pause" as firms retool to incorporate new technology as well as a postrecession decline in research-and-development investment that has started to reverse.