Investors will be watching the action in exchange traded funds (ETFs) tracking the dollar and U.S. Treasury bonds Wednesday as Federal Reserve Chairman Ben Bernanke faces off against a room of reporters.

An ETF investing in long-term bonds, iShares Barclays 20+ Year Treasury Bond Fund (NYSEArca: TLT), is essentially flat for the year. However, the PowerShares DB US Dollar Bullish Fund (NYSEArca: UUP) has been pummeled in 2011 by a weaker greenback.

Bernanke will be holding a first-ever press conference Wednesday following the Fed’s announcement on interest rates.

Standard & Poor’s recent demotion of the U.S. credit outlook to negative will likely be a topic of discussion. The Fed chief will also likely face questions over rising inflation fears and the central bank’s bond-buying program.

The S&P credit downgrade may actually serve to kick start an agreement to reduce the U.S. debt by $4 trillion over the coming decade, reports Julie Hirschfeld Davis for Bloomberg. However, the two parties are still divided over the push for tax increases and entitlement programs like Medicare.

In light of S&P’s credit outlook downgrade, Congress could vote early to increase the government’s $14.29 trillion legal debt limit. However, the Treasury Department calculates that the debt ceiling will be hit by May 6.

House Democratic Whip Steny Hoyer of Maryland stated that the S&P’s revision “shows the urgent, bipartisan action needed to put our nation on a serious path to reduce deficits.”

Max Chen contributed to this article.

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