The Senate Banking Committee will hold separate hearings next week for Jerome Powell on his nomination to a second term as Federal Reserve chair and for Lael Brainard’s elevation to vice chair.

Two days after one of the Federal Reserve’s most hawkish pivots in recent years, the rates market is already calling the central bank’s bluff.

Investors responded to the Federal Reserve’s intent to tackle inflation with a clear risk-on pivot, as stocks climbed and Treasuries steadied.

The hottest rate of inflation in four decades has ushered in a wilder era of bond-market volatility, causing investors to shop for hedges to protect their portfolios.

Prospects that inflation will be held in check may weigh against the need for the Fed to speed up the process of policy tightening.

He also told the Senate that he wanted to retire the word “transitory” to describe price increases, and he said inflation pressures will “linger well into next year.”

Jerome Powell’s appetite for a faster tapering of Federal Reserve stimulus is casting him in a role financial markets haven’t seen since 2018: hawk.

The FOMC decided to leave interest rates near zero and begin scaling back the pace of purchases in the $120-billion-per-month bond-buying program it launched last year, with an eye toward completing the process by mid-2022.

Offsetting the weak job-creation number were an upward revision to August payrolls, a bigger-than-expected drop in unemployment and a faster pace of wage growth.

Republicans believe there’s enough time left if Democrats start Wednesday or Thursday, a GOP aide said on condition of anonymity. Republicans could keep the vote-a-ramas very limited to keep things moving along.