$1 trillion? $2 trillion?

$1 trillion? $2 trillion?

One of the biggest factors for how the US dollar reacts in the month ahead will be the contours of the next round of US government stimulus.

The Washington Post today digs into the dynamics and notes that White House advisor Peter Navarro is pushing for $2 trillion in spending.

At the same time, the fiscal hawks in the Republican party are trying to reclaim their identity and keep it below $1 trillion. The report highlights the divisions at the White House and within the Republican party. Couple that with Democratic control of the House and an big battle is brewing.

A key detail will be what happens to the extra $600/week in US unemployment benefits but that's part of a multitude of options that have been floated:

The White House is studying but has not reached a final decision on whether it supports an infrastructure package; aid to state and local governments; another round of $1,200 stimulus checks; delaying the tax filing deadline beyond July 15; and a fix to the coming expiration of additional unemployment benefits, among other issues. While it is clear Trump is eager to pass a payroll tax cut, a cut to taxes on capital gains, and deductions for the restaurant and entertainment industries, the administration has not formulated a concrete proposal, and these ideas have largely been dismissed by Congressional lawmakers.

An early tell may be who the White House lets lead its negotiations:

Several leading conservative activists said they are also pushing for White House chief of staff Mark Meadows, the former leader of the anti-spending House Freedom Caucus, to exert a larger influence in negotiations. Meadows only assumed his current role at the tail-end of the negotiations over the $2.2 trillion Cares Act and had few opportunities to directly shape the bill. Both Pence and Meadows have deeper ties to the conservative establishment than Mnuchin, a former Wall Street banker.

It will be a miracle if a bill gets passed without some major drama.