U.S. Fed chair Jerome Powell faces lawmakers in two days of testimony and is likely to be questioned on whether rates will really rise again in July and peak in a 5.5%-5.75% range as projected.

"Investors fear Powell will hint that rate hikes could resume next month after the hawkish pause at last week's FOMC meeting," DBS analysts said in a note.

Around 80% of investors have priced in a quarter-point Fed rate hike in July, with rate cuts being seen at the end of the year or early next year, according to the CME Fedwatch tool.

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