Closing Wrap - Thursday 23.07
Headlines
  • GOP Won’t Seek Payroll-Tax Cut In Coronavirus Relief Package
  • China ‘Set To Shut US Consulate’ In Response To Houston
  • China Threatens To Stop Recognising UK’s Hong Kong Passports
  • Fed Broadens Firms It Will Transact With On Three Loan Programs
  • ECB: Banks Not Sufficiently Prepared For Benchmark Rate Reforms
  • Apple Faces Multi-State Consumer Protection Probe
  • EU Demands Major Concessions From Google Over Fitbit Deal
  • Elon Musk’s SpaceX In Talks To Raise Funds At $44 Bln Valuation
  • EY Prepared Unqualified Audit For Wirecard In Early June
Commentary
US Jobless Claims 15-Weeks Of Declines Comes To An End

1.416mln

Claims came in above the consensus estimate of 1.3mln and rose from the prior 1.307mln, hitting a four-week high. This previous week was revised higher by 7k from 1.3mln. The four-week moving average declined to 1.360mln, a drop of 16.5k from the previous week. The streak of 15 straight weeks of claims falling has been broken, and there are now 52.64mln workers who have filed first-time unemployment claims since the start of the pandemic.

 

11.8pct

The Labour Department’s insured unemployment rate fell from the previous week’s print of 11.9pct. This counts the number of people actively collecting benefits compared with the total size of the labour force and is considered an alternative measure of joblessness.

Continuing claims have fallen for seven weeks running and ticked down by 1.107mln from last week, below the expected 17.1mln. The prior reading was revised lower, from 17.338mln to 17.304mln, and the four-week average now stands at 16.197mln from the prior 17.3mln. (LiveSquawk - Continue Reading)

Has The Coronavirus Pandemic Weakened The U.S. Dollar Status As The International Reserve Currency?

The U.S. budget deficit in June is about the same as it was for the full fiscal year of 2019 because of spending to support the national economy during the coronavirus epidemic. At the same time, the revenue of the state treasury has plummeted. This has put additional pressure on the dollar and will make it more difficult for it to be able to maintain its status as an international reserve currency.

 

According to the U.S. Treasury Department, household spending in June exceeded revenue by USD864.1 billion. That’s twice as much as in May. In April, the U.S. Committee for a Responsible Federal Budget predicted that a drastic economic downturn, along with urgent bailouts, would quadruple annual household spending to USD3.8 trillion, 18.7pct of the GDP. However, this forecast also appears to be overly optimistic. In the first nine months of the current financial year, the budget deficit has already reached USD2.74 trillion. The previous negative record of USD1.4 trillion was registered in 2009 when the global financial crisis was at its worse. Continue Reading

GOP Won’t Seek Payroll-Tax Cut In Coronavirus Relief Package

Senate Republicans delayed the release of the party’s coronavirus relief proposal as GOP lawmakers and the White House strained to finalize an opening offer in negotiations with Democrats.

 

In their bill, Republicans are expected to include an extension of enhanced jobless benefits, but at a lower level than the continuation of the current $600 a week that Democrats are seeking. The GOP package will also include another round of $1,200 stimulus checks to many American households.

 

In a blow to President Trump, Senate Republicans won’t include the payroll-tax cut he sought amid opposition from lawmakers of both parties.

 

“It won’t be in the base bill,” Treasury Secretary Steven Mnuchin said during a Thursday interview with CNBC, adding that the measure could be included in future coronavirus relief bills. (WSJ - Continue Reading)

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