D.O.A.
Senate Majority Leader Mitch McConnell declared the House bill dead on arrival and said that his office would begin drafting the next bill in mid-to-late July after analyzing economic data. McConnell has publicly called for the next bill to include liability protections for businesses seeking to reopen and privately Republicans are seeking to cap any further spending at $1 trillion or less.
On Monday House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer wrote to McConnell urging him to begin immediate bipartisan talks on stimulus given the rising number of Covid cases and stalled reopening in many states. Democrats are also calling on McConnell to cancel the two-week Senate recess that begins Thursday to tackle the next relief bill.
Economists caution that a long period of labor re-allocation -- where workers in an industry directly impacted by the virus such as lodging have to find new skills and jobs in other industries -- risks keeping unemployment high for years.
The Labor Department will release jobs data for June on Thursday. Forecasters surveyed by Bloomberg see the unemployment rate dropping to 12.5% compared with 13.3% for May.
‘Extraordinarily Uncertain’
The Fed chair in his remarks to lawmakers struck an optimistic note on what he is seeing as economic activity resumes. Hiring is picking up, he noted, and spending is increasing, though he cautioned that 20 million Americans have lost their jobs.
“The path forward for the economy is extraordinarily uncertain and will depend in large part on our success in containing the virus,” he said. “A full recovery is unlikely until people are confident that it is safe to re-engage in a broad range of activities.”
As he has in recent appearances, Powell also warned against pulling back on any form of stimulus too soon.
“The path forward will also depend on the policy actions taken at all levels of government to provide relief and to support the recovery for as long as needed,” he said.
--With assistance from Matthew Boesler, Craig Torres, Rich Miller, Erik Wasson and Mark Niquette.
This article was provided by Bloomberg News.