The Day at a Glance | September 21 2020

The Top

· Powell and Mnuchin will testify before US Congress this week and will be questioned about the need for greater fiscal stimulus.

· ECB will revise its purchasing programs to assess their extension and flexibility: Financial Times.

· Confidential documents were disclosed over the weekend and sounded the alarm regarding suspicious transactions involving money laundering of up to $2 trillion dollars in banks such as Deutsche Bank, JP Morgan, HSBC and Barclays.

Economic environment

Chair of the Federal Reserve Jerome Powell and US Treasury Secretary Steven Mnuchin will testify before Congress this week. As time runs out, the audience`s attention will be focused on the need for greater stimulus before the elections in November. The last fiscal package – of $2 trillion dollars – boosted a strong recovery in production and employment after the virus`s impact, but its effects have worn off and legislators will listen to both officials, who are in charge of implementing stimulus programs due to the need for greater action. Both Mnuchin and Powell have reiterated their inclination for maintaining government spending allocated towards avoiding the worst of the virus`s economic impacts. However, in Washington, Republicans and Democrats have still not reached an agreement as time runs out in the legislative chambers. The issues expected to be discussed include the FEDs available resources, assistance to local and state governments and unemployment aid. The lack of a new fiscal stimulus in the US could contribute to a halt in recovery in the second half of 2020.