Banks say it’s good for the US economy

The “big, beautiful bill” of US President Donald Trump – or officially, one big beautiful bill (OBBB) is a controversial legislative act, but some banks are in favor of it, saying it is a shot in the hand that requires the economy.

It was advanced in a Narrow 51-49 voting In the US Senate, at the end of Saturday, moving a great measure closer to the president’s table.

A bill characterized by extensive tax reforms and targeted stimuli and there are Forecast Add to Federal Deficiencycaused warnings from credit agencies and attracted criticism.

But some banks say they believe that the bill may increase the US economy.

In a letter published on Sunday, The American Bankers Association It “strongly supports” numerous provisions in the bill on the “so necessary tax benefits” they offer.

“I think OBBB will be almost indisputable for the US economy over the next few years compared to what has not accepted anything,” said David Safa, the chief economist Nomura in the developed markets, given that taxes will grow largely after the expiration of many provisions in accordance with the tax for 2017.

The tax and job reduction law adopted in 2017 includes lower income tax rates, higher tax credits for the child and generous deductions for business. Without Congress, many provisions provided for by law must end by the end of 2025 – analysts have said that they could reduce the consumption of households and corporate investments. The short -term appeal of the “great beautiful bill” is to avoid a sharp financial reduction in 2026, they said.

“The most important thing that does OBBB over the next few years is to restore most of those who have ended with the tax provisions, preventing a major and sudden financial reduction from appearing,” said the CNBC safe. “The OBB provisions that allow you to get faster capital investment costs can attract investments over the next few years, although it is probably due to investments in the coming years,” he added.

Citi strategists are also stated in a note published last Wednesday, the adoption of the bill will become an economic rear. “In the near future, trade transactions (UK, China, after all Japan, India, Europe, etc.) and the adoption (pure stimulation) of a large beautiful bill in July should improve growth moods,” they wrote.

Citi also expects that the federal reserve system will weaken its monetary policy, enhancing the mood of growth, and said: “We do not see how we do not see the bonds during 2025/2026, since the BBB delta is largely funded by tariff revenue.”

The borrowed load causes the main problem for many critics. The non -party budget budget in Congress is engaged in projects BBB will add at least 3 trillion dollars to a federal deficit over the next decade.

Although Morgan Stanley noted in early June That tax provisions for taxation of the bill can benefit businesses and individuals, as well as key sectors of capital such as communications, industry and energy services, it is said that it may be concerned with financial sustainability.

Similarly, Eric York, Vice -President of the Federal Tax Policy Center for Tax Tax Policy, said: “This is fiscal irresponsibly, significantly increasing the budget deficit and debt even when accounting for growth.”

York said many of the tax reducing are complex and poorly developed, which gives a decline in taxes to certain types of workers and leaving others.

In addition, from the bill, which includes many narrow tax rules, the internal revenue service will have to spend more time and resources of renewal, management tools and execution, which adds to the administrative severity of the already stretched agency, York said.