Following the Fed rate cut and a change to capital rules, the US policymakers unveiled new plans to provide roughly $8 billion emergency funding bill to fight the coronavirus, as per the NBC news.
Key quotes
The bill, which passed by an overwhelming majority, provides $7.8 billion to fight the coronavirus and includes a mandatory funding authorization for $500 million over a 10-year period to be used toward a remote health care program.
The bill includes a provision that requires that funds are only used to fight the coronavirus and other infectious diseases as some Democrats feared that the Trump administration could raid the funding and use it for other unrelated purposes.
Trump had submitted a $2.5 billion request to Congress to combat the virus, but Democrats quickly said that that amount would be insufficient. Sen. Chuck Schumer, D-N.Y., responded with an $8.5 billion proposal. Schumer said Tuesday that he expected the final deal to be between $7 billion and $8 billion.
Trump said separately at an event in Washington on Tuesday morning, ‘It looks like they’re going to give us $8.5 billion,’ and added, ‘I think I should say, ‘I’ll take it.’
FX implication
It can be considered as an additional boost to the recent risk reset, US dollar recovery. As a result, the USD/JPY extends the recovery from a multi-week low to 107.55 after the news.
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