The Number of the Week Is $1.9 Trillion
A gusher of new Covid relief funding is set to supercharge the economy, but will rising bond yields thwart the recovery?
President Joe Biden is not thinking small when it comes to Covid relief.
Photographer: Chris Kleponis/CNPPresident Joe Biden signed the $1.9 trillion American Rescue Plan Act into law on Thursday. Wall Street expects the money will supercharge the economy, with many analysts boosting their growth estimates for this year to more than 6%, and some are even forecasting as much as about 8%. Boom times, indeed, but there’s a very big wild card: the bond market.
There’s been a lot of handwringing in recent weeks over the surge in yields on U.S. government bonds. Those for the benchmark 10-year Treasury note, which help determine borrowing costs for states, companies and individuals, closed this week at 1.625%, the highest in more than a year and more than triple the 0.51% level they stood at in August.