July 10 (Reuters) - A look at the day ahead in Asian

markets.

Is a U.S. interest rate cut coming? If so, when?

Federal Reserve Chair Jerome Powell told Congress on Tuesday

that the U.S. is "no longer an overheated economy," remarks that

suggested the case for rate cuts is strengthening.

Some investors had anticipated the Fed chair, in his testimony

to a Senate banking panel, might do more than he did to

telegraph that a cut was on track for the central bank's

September meeting. Yet, as of late Tuesday, that still appeared

to be the market's broad expectation: Fed Funds futures were

pricing in a nearly 75% chance of a cut in September, according

to CME FedWatch.

More insight may come on Wednesday, when Powell returns to

Capitol Hill to testify before a House of Representatives

committee. And Thursday's consumer price index report is sure to

be closely watched to see if inflation is, in fact, moderating

to the central bank's liking. A surprise spike could throw the

case for rate cuts into doubt.

Markets took Powell's testimony largely in stride. The benchmark

U.S. S&P 500 index and MSCI all-country equity index

were both little changed. The dollar

moved slightly higher, indicating that some investors were

looking for more dovish talk from the Fed chief.

There was sharper stock action in Europe, where indexes were

weighed down by weakness in French stocks as political

uncertainties lingered. Europe's STOXX 600 index fell

0.9%, its biggest one-day drop in nearly a month. France's

benchmark CAC 40 index sank 1.6%, as investors assessed

the political situation following Sunday's legislative election.

Politics threatened to cast a shadow over markets more broadly,

as U.S. President Joe Biden faced some pressure to drop his

re-election bid after his shaky debate performance against

former President Donald Trump.

Meanwhile, the debate over rates was also set to extend to the

Reserve Bank of New Zealand, which meets on Wednesday. The RBNZ

is expected to hold its key cash rate for an eighth straight

meeting and cut rates just once before year-end, according to a

Reuters poll of economists.

Also on Wednesday, producer and consumer price inflation figures

are due in China, which could sway markets. On Tuesday, China's

blue-chip CSI300 index rose 1.2%, lifted by tech

shares.

Here are key developments that could provide more direction

to markets on Wednesday:

- Reserve Bank of New Zealand meeting

- China PPI/CPI (June)

- Fed Chair Powell testifies for second day at Congress