US Senate passes $1.9 trillion stimulus bill

Huge spending bill passes 50-49

Huge spending bill passes 50-49

The US Senate passed Biden’s $1.9 trillion stimulus package with a number of amendments after a marathon session. The bill now heads back to the House where a vote will be held on Tuesday. It could be signed into law shortly afterwards.

The highlight of the bill is a $1400 check to most Americans but it also includes $350B in aid to state and local governments along with heavy spending on child poverty.

The last minute compromise included cutting a $400 a week supplement for those on unemployment assistance to $300. That was combined with a shift to make the first $10,200 in unemployment benefits tax free.

I think there is some upside for markets on Monday based on this. It was mostly priced in but the thinking was that the pricetag would be cut by around $200B. Later this year, Biden will also try to push through an infrastructure bill that could be as large as $3 trillion.

Moreover, the bill will keep the US dollar on an upward track against the euro as inflation and rate differentials widen.

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By Jonathan Prop

Jonathan Prop is an independent financial advisor. He has been working in finance for the last 20 years. After retiring early in his 40s, Jonathan decided to help others get to grip with financial markets, particularly his area of expertise - forex!

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