House Dems push to end shutdown.
January 03, 2019
House Dems seek to ease debt limits. The incoming House Democratic majority are planning to make it easier to raise the federal borrowing limit, in hopes to avoid last minute congressional showdowns over the debt ceiling. In the past, these down-to-the-wire negotiations have been volatile to both investors and markets. Some Republicans, however, believe the battles have been useful in keeping federal spending in check. On Thursday, the House is set to vote on reviving the Gephardt rule, which would allow the chamber to suspend the debt ceiling when approving the annual budget. This would allow lawmakers to avoid a separate vote on the borrowing limit. Any debt-limit measure passed in the House, however, will need 60 votes to pass in the Republican-controlled Senate, who are unlikely to embrace the Gebhardt rule. In recent years, Republicans have often paired any borrowing increase with cuts in spending. [WSJ]
House Dems push to end shutdown. House Democrats passed legislation on Thursday morning that would put an end to the 13-day partial government shutdown, all the while ignoring the President’s call for $5 billion for a border wall. Roughly a quarter of the federal government remains closed due to the President’s demand for border wall funding as part of any legislation set to fund the government. The two-part Democratic package includes funding for the Department of Homeland Security, $1.3 billion for border fencing, and $u300 million for other border security. The second part would fund the agencies currently suffering from the shutdown, including the Department of Agriculture, Interior, Transportation, Commerce, and Justice, through the end of the fiscal year. [Reuters]
Economic Indicators and News
Jobless claims increase more than expected.The number of Americans applying for jobless benefits increased more than expected last week, but the numbers still point to a strong labor market despite ongoing market volatility. Initial claims for state unemployment benefits rose 10,000 to 231,000 for the week ended December 29, with 5,000 more applications received the week prior than previously reported. Economists polled by Reuters estimated a total of 220,000 claims in the latest week. The Labor Department has stated that there is no indication that the increase in applications is due to federal workers currently affected by the shutdown. [CNBC]
Private sectors adds most jobs in nearly 2 years, ADP report shows. U.S. private sector employment added 271,000 new jobs in December, well above the forecasted 175,000. It is the highest gains since February 2017. The ADP report released Thursday shows that small firms added 89,000 jobs, while medium-size businesses added 129,000 and large 54,000. Stock futures improved slightly upon the release of the report, but the Dow Jones is still unstable following Apple’s China warning. [MarketWatch]