New fiscal stimulus likely to be underwhelming

The bipartisan infrastructure deal, which could be passed by end-September, would provide no meaningful boost to the economy over the next couple of years. The $3.5trn spending package that Democrats aim to pass via reconciliation later this year could provide more stimulus, but we suspect that spending would be largely offset by tax increases and there is a strong possibility that centrists, in not just the Senate but the House too, will refuse to support it.