We suspect that President Joe Biden will struggle to garner bipartisan support for his $2trn in infrastructure spending, even if he was willing to placate centrist Senate Republicans by dropping his proposal to fully fund that investment by raising corporate taxes. We think the most likely outcome is that the Democrats will end up passing a revenue-neutral infrastructure package using a budget reconciliation early in the next fiscal year, which begins this October. As a result, we are leaving our forecasts unchanged – we still expect GDP growth to be 6.5% in 2021 and 4.0% in 2022.
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