By Scott J. Brown, Ph.D., Raymond James
Government Budgets – On Monday afternoon, the U.S. Treasury is expected to announce a June budget shortfall of about $863 billion, bringing the 12-month total to nearly $3 trillion (or about 14% of pre-pandemic GDP). The red ink will continue. Lawmakers are expected to approve another round of federal stimulus later this month. None of that is worth losing sleep over. The danger is not doing enough to support the economy now or tightening the budget too soon, dampening the recovery. While investors focus on the federal budget, state and local governments may be more important.
This Week – The mid-month economic data reports are expected to reflect further improvement in the economy, but investors are likely to keep a close eye on the escalation in COVID-19 cases.