“It is always a minefield when the Fed chair goes to these semi-annual hearings, but there are even more mines in that field this time around,” said Steve East, an analyst at Height Securities, a research firm that focuses on geopolitical and regulatory investment risk.
The “very strange election” season exposes a wide divide between the parties on economic issues, he said, making it potentially hard for Yellen to keep her footing.
Democrats will probably ask Yellen “what will happen to the U.S. economy if Trump is elected?” East said.
Republicans will ask if trading partners are taking advantage of U.S. firms and if regulation is strangling the economy.
“Yellen will steer as clear as she possibly can of anything political,” East said. That won’t keep lawmakers from trying.
The Fed head’s testimony comes on the heels of her downbeat assessment of U.S. economic prospects at her press conference on Wednesday.
Yellen and her interest-rate-setting panel displayed a dovish tilt, discussing long-term forces that might persist in holding down the economy and keeping interest rates low for the foreseeable future. As a result, the Fed now sees a lower path for interest rates over the next two and a half years than they did a few months ago.
Read: Go-slower approach prevails as Fed leaves interest rates unchanged
Yellen could use Congress’ help in removing one of the long-term forces holding down the economy, namely low productivity, experts said.
“Good fiscal policy can help boost productivity through educating and training workers, enhancing physical infrastructure like highways and airports and by supporting research and development,” said Doug Elmendorf, former director of the Congressional Budget Office.
He noted that federal investment will soon be smaller relative to the size of the economy than at any point in 50 years.
Republicans are more open to discussing tax and entitlement reform, said Douglas Holtz-Eakin, also a CBO director who was the top economic adviser to former Republican presidential candidate John McCain.
These differences are likely to be “litigated across party lines” during the two days of hearings with Yellen looking on, Holtz-Eakin said.
Greg Valliere, chief global strategist for Horizon Investments, said Yellen may refrain from any comment that could be construed as pushing for more stimulus.
“If she is seen as an advocate for more spending or tax cuts, she would put a target on her back,” he said.