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Senate Majority Leader Mitch McConnell opens the door to a smaller coronavirus relief package

Senate Majority Leader Mitch McConnell (R-Ky.) on Wednesday appeared to open the door to a smaller coronavirus relief package than the proposal unveiled by Republicans earlier this week. 

The Hill reports on the news that McConnell, asked about soon-to-expire unemployment benefits, said that neither party wants them to expire, which is set to formally happen on Friday. 

“Many things around here happen at the last minute. This is only Wednesday, so hope springs eternal that we’ll reach some kind of agreement either on a broad basis or a more narrow basis to avoid having an adverse impact on unemployment,” McConnell told “PBS NewsHour.”

Key notes from the article

  • Asked if he was seriously looking at either a smaller bill or a short-term option, he added, “We’re looking at all options.”
  • McConnell’s remarks, the first time he’s appeared open to a smaller bill, come as top Trump administration officials and a growing number of Republican lawmakers have signaled an openness to getting a pared-down agreement as talks with Democrats have yielded little progress. 
  • What would be included in a smaller agreement has not been agreed upon, with GOP senators saying myriad ideas were being discussed as they try to break the stalemate. 
  • Under the March coronavirus deal, Congress agreed to a $600-per-week increase of unemployment benefits. As drafted, the enhancement will formally expire on Friday, but because of the calendar and how states distribute benefits, they began to expire on Saturday.
  • Part on a lot of issues,” Mnuchin said. “I do think there’s a subset of issues that we do agree on, but overall we’re far from an agreement.”

Market implications

The deadlock is  weight on markets.

The lack of progress in the current US fiscal negotiations continued overngith with President Trump calling on Republicans who oppose further spending to “go back to school and learn”, will likely continue to weigh on sentiment into the end of the month at this rate.

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