The White House on Monday proposed taking an additional decade to balance the US budget as it delivered a spending plan that relies on aggressive growth predictions to close a yawning budget gap, drawing increased scrutiny from financial markets.
The new $4.4tn proposal for next year, which includes a plan for $200bn in new infrastructure spending over the next decade, came just days after Donald Trump signed off on a two-year spending bill that includes large increases in defence and domestic programmes which are included in the new budget proposal.
Mr Trump’s push for freer spending is aspirational as Congress rather than the president ultimately controls the US purse strings. But it coincides with growing anxiety in financial markets over the prospect of rising interest rates and the wisdom of injecting fiscal stimulus into an economy at or near full employment.
Overnight on Wall Street, the S&P 500 gained 1.4 per cent as energy and technology stocks helped the benchmark recoup more of last week’s heavy losses, which briefly pushed it into correction territory.
In Asia Pacific equities futures tip Sydney’s S&P/ASX 200 index open flat, while Hong Kong’s Hang Seng is set to rise 0.6 per cent when trading begins.
Corporate earnings reports out today include Hopewell Holdings, Rakuten, Shimano, Yamaha Motor, SmarTone and Singapore Air.
The economic calendar for Tuesday is all this and more (all times Hong Kong):
- 07.50: Japan producer price index
- 08.30: Australia NAB business conditions
- 14.00: Japan machine tool orders
- 16.00: Taiwan Q4 gross domestic product (final)
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