(Reuters) – European shares dipped in early trading on Wednesday ahead of U.S. Federal Reserve Chair Jerome Powell’s two-day testimony where investors will closely watch for signs of an interest-rate cut later this month.

Powell is scheduled to give his semi-annual monetary policy testimony to Congress at 1400 GMT, and investors see a worrying lack of inflation globally as one reason for Powell to sound suitably dovish.

The pan-European shares index fell 0.2% and was on course to extend losses to a fourth day, with Spain’s IBEX .IBEX underperforming with a 0.4% loss.

Stocks with exposure to Mexico led losses in Madrid with BBVA (BBVA.MC), Iberdrola (IBE.MC) and Telefonica (VIVT4.SA) down between 0.6% and 0.8%, after a shock resignation of Mexican Finance Minister Carlos Urzua on Tuesday rattled Mexican markets.

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