Despite a rise in inflation expectations caused by a flurry of positive economic data, the U.S. Federal Reserve may still not decide to tighten rates any time soon, according to an analyst.

Despite signs that the economic recovery is gathering momentum and growing speculation about policy rates elsewhere, the futures markets still puts pretty low odds on a US rate hike this year, according to Paul Ashworth, economist at Capital Economics.

The recent unrest in the oil-producing nations in the Middle East have already dented the chances of an immediate rate hike in the U.S. Added to this are other factors like persistent unemployment and price stability.

... the Fed is still nowhere near meeting its goals of maximum employment and price stability. The unemployment rate is still far too high and core inflation is far too low, says Ashworth.

The analyst says that the Fed's main priority would be to tighten policy by removing its unconventional stimulus before moving on to conventional rate hikes.

The financial markets are watching for any signs of a shift in tone in US Fed Chairman Ben Bernanke’s semi-annual testimony to Congress this week. Ashworth says Bernanke could present largely identical testimony to the Senate on Tuesday and the House on Wednesday.