“Clearly it deflates some of the optimism that was being priced into the market,” said Jon Hill, an interest-rate strategist at BMO Capital Markets.
However, he told The Wall Street Journal, investors seem to realize that the announcement “doesn’t mean we’re never getting another fiscal deal—it just means it won’t happen before the election and possibly not before inauguration.”
Many economists say a new aid package is important for the economy as the country continues to deal with the fallout from the coronavirus pandemic.
Republicans and Democrats had been moving closer after the House passed a $ 2.2 trillion bill last week, a reduction from the $ 3.5 trillion bill House Democrats passed in May.
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