Feb 27 (Reuters) - U.S. short-term interest-rate futures dropped on Tuesday after Federal Reserve Chairman Jerome Powell told a congressional committee that recent data has strengthened his confidence that inflation is headed up toward the central bank's 2-percent target.
After Powell said fiscal policy is more "stimulative," the economy is "strengthening" and that the latest data gave him more confidence about inflation, traders of the futures began pricing in a higher chance of a fourth rate hike this year, based on a Reuters analysis of fed funds futures contracts traded at CME Group Inc.
Traders continued to expect the first hike of the year to come next month, and saw a more than one in four chance that the Fed would raise rates three more times this year.
(Reporting by Ann Saphir in San Francisco; Editing by Chizu Nomiyama)
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