Mnuchin Says He Expects Most of Economy Opening by Late Summer
Mnuchin Says He Expects Most of Economy Opening by Late Summer
(Bloomberg) -- Treasury Secretary Steven Mnuchin said he anticipates most of the U.S. economy will restart by the end of August after the coronavirus has led to social distancing measures that have shuttered many businesses.
“We’re operating under the environment that we are going to open up parts of the economy and we’re looking forward to -- by the time we get later in the summer -- having most of the economy, if not all of the economy, open,” he said early Wednesday on Fox Business Network.
Mnuchin suggested that after President Donald Trump signs another $484 billion funding measure into law, the economy will have all the rescue funds it needs to cope with the pandemic-induced shutdown.
House lawmakers on Thursday are set to pass the funding measure to add to the $2.2 trillion virus relief package signed into law less than four weeks ago.
Mnuchin said that the funds are not economic stimulus, but rescue money.
By the end, small businesses will have had access to more than $600 billion in federal assistance through the Small Business Administration and emergency disaster loans.
“I hope it is enough,” Mnuchin said.Part of the rescue funds provided to the Treasury Department can be leveraged through Federal Reserve lending facilities for as much as $6 trillion in liquidity.
Mnuchin and congressional leaders also expect to turn to a next-stage financial package that would act as an economic stimulus, including possible funding for state and local governments as well as infrastructure spending, which already has been part of Trump’s economic agenda.
The U.S. budget deficit is seen quadrupling this year to almost $4 trillion, an amount that doesn’t include the legislation pending in Congress.
“We need to spend what it takes to win the war,” Mnuchin said, adding that interest rates on the additional debt will be relatively low. “On the other hand, we are sensitive to the economic impact of putting on debt and that’s something that the president is reviewing with us very carefully.”
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