Federal Reserve hints it will end pandemic stimulus programs
5.00pm EDT 17:00
Today so far
4.29pm EDT 16:29
Biden to consider ‘potential further executive actions’ after police reform talks fail
1.53pm EDT 13:53
Police reform negotiations come to a formal close, Bass says
12.54pm EDT 12:54
France to send ambassador back to US after Macron-Biden call
12.03pm EDT 12:03
Today so far
11.00am EDT 11:00
Biden to announce US will donate another 500m vaccine doses to other countries
5.44pm EDT 17:44
Dominic Rushe
The latest Fed statement also showed that more members of the Fed committee now believe that interest rates should rise in the near future. Nine of the 18 officials expect to raise interest rates by the end of 2022, up from seven officials in June when a majority said they thought rates would rise in 2023.
US stock markets reacted favorably to the news, which suggests the economy is still recovering from the pandemic, albeit with uncertainties remaining. Investors have been spooked in recent days by news that troubled Chinese property developer Evergrande could default on its $300bn debts. The company’s woes could drag in investors worldwide, but on Tuesday the company said it would be able to meet some of its obligations.
Powell said the situation “seems particular to China which has very high debt for an emerging market economy.
“In terms of the implications for us, there is not a lot of direct United States exposure,” he said.
5.38pm EDT 17:38
Federal Reserve hints it will end pandemic stimulus programs
Dominic Rushe
The Federal Reserve signaled on Wednesday that it may start cutting its enormous pandemic stimulus programs as soon as November and could raise interest rates next year.
The US central bank left interest rates unchanged at near zero after its latest meeting. Rates were cut in March 2020 as the US economy reeled from the impact of the pandemic. But the Fed also indicated it may soon start pulling back on the $120bn in monthly asset purchases program that it started when the coronavirus hit the US.
“If progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted,” the Fed’s post-meeting statement said.
At a press conference Fed chair Jerome Powell said the jobs market was “very strong” and that while the central bank was trimming its forecasts for economic growth it still foresees “rapid growth” in the economy.
Powell said the pandemic was still having an impact and that bottlenecks and shortages were driving price inflation but he expected that situation to ease as long as the coronavirus pandemic is contained. “The path of the economy still continues to depend on the course of the virus,” he said.
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5.17pm EDT 17:17
Florida’s surgeon general Joseph Ladapo has issued a new emergency rule that parents can decide whether or not their children should quarantine after being exposed to someone who tested positive for Covid-19.
Governor Ron DeSantis announced that Lapado, who has been skeptical of research-backed public health measures like mask-wearing, lockdowns and vaccines to curb the spread of coronavirus, would be the state’s new surgeon general on Tuesday. The Republican governor has tried to ban schools from enforcing mask mandates.
The new rule states that parents rather than school administrations, must be the ones to decide asymptomatic kids who have been exposed to the virus should quarantine.
It was “important to respect the rights of parents”, Ladapo said.
The new emergency rule will replace a previous rule requiring students to quarantine for four days after being exposed.
Updated at 5.33pm EDT
5.00pm EDT 17:00
Today so far
That’s it from me today. My west coast colleague, Maanvi Singh, will take over the blog for the next few hours.
Here’s where the day stands so far:
Joe Biden announced the US will donate another 500 million Pfizer coronavirus vaccine doses to other countries. The announcement means the Biden administration has now committed to sending more than 1.1 billion vaccine doses abroad. “Put another way, for every one shot we’ve administered to date in America, we have now committed to do three shots to the rest of the world,” Biden said at a virtual Covid summit today.
Emmanuel Macron is sending the French ambassador to the US back to Washington, after he and Biden had a conversation today about France’s outrage over the Aukus defense deal. The French president also plans to meet with Biden in Europe next month.
Bipartisan talks over a police reform bill have officially collapsed, after months of back-and-back between the negotiators. Democratic congresswoman Karen Bass blamed the failure on Republicans involved in the negotiations, saying in a statement, “Every time, more was demanded to the point that there would be no progress made in the bill that we were left discussing.” Biden said he would consider “potential further executive actions” to address police reform after the talks collapsed.
House Democrats passed their spending bill to keep the government funded and suspend the debt ceiling until December. However, the legislation faces bleak prospects in the evenly divided Senate, where Republican leader Mitch McConnell has pledged to oppose any effort to raise the debt ceiling.
The select committee investigating the Capitol insurrection is considering issuing a number of subpoenas to former Trump administration officials. Former White House chief of staff Mark Meadows, deputy chief of staff Dan Scavino and former Trump campaign manager Brad Parscale are among those who are likely to get subpoenaed by the committee.
Maanvi will have more coming up, so stay tuned.
4.44pm EDT 16:44
House speaker Nancy Pelosi said the chamber is “on schedule” to hold a vote on the bipartisan infrastructure bill on Monday.
Asked whether the House will also be ready to vote on the reconciliation package by Monday, as progressive lawmakers have demanded, Pelosi did not give a concrete answer.
“We’re calm, and everybody’s good, and our work’s almost done,” Pelosi told reporters on Capitol Hill.
The Democratic speaker met with Joe Biden at the White House this afternoon, as progressives threaten to block the infrastructure bill over their concerns about the reconciliation package.
4.29pm EDT 16:29
Biden to consider ‘potential further executive actions’ after police reform talks fail
Joe Biden said he will consider “potential further executive actions” to address police reform after the bipartisan team of congressional negotiators failed to reach a deal on a bill.
“The murder of George Floyd is a stain on the soul of America,” the president said in a new statement addressing the collapse of the negotiations. “It spurred the nation to collectively demand justice, and we will be remembered for how we responded to the call.”
Biden said he was “deeply grateful” to congresswoman Karen Bass and Senator Cory Booker for working to reach an agreement over the past several months.
“Regrettably, Senate Republicans rejected enacting modest reforms, which even the previous president had supported, while refusing to take action on key issues that many in law enforcement were willing to address,” Biden said.
The president noted he still hoped to sign police reform legislation, but he said he would soon explore additional steps to determine what executive action he may be able to take on the issue.
“In the coming weeks, we will continue to work with Senator Booker, Congresswoman Bass, and other members of Congress who are serious about meaningful police reform,” Biden said.
“The White House will continue to consult with the civil rights and law enforcement and civil rights communities, as well as victims’ families to define a path forward, including through potential further executive actions I can take to advance our efforts to live up to the American ideal of equal justice under law.”
4.11pm EDT 16:11
The White House shared a photo from Joe Biden’s phone call with French President Emmanuel Macron earlier today.
“Today I spoke with President Emmanuel Macron of France, and reaffirmed the importance of French and European engagement in the Indo-Pacific region,” Biden said in a tweet that included the photo.
“I look forward to a process of in-depth consultations and to meeting with him in October.”
Asked about the two leaders’ conversation during the White House press briefing, Jen Psaki said the call was “friendly” and lasted around 30 minutes.
“It was one where we’re hopeful and the president is hopeful this is a step in returning to normal,” Psaki said of the phone call.
Psaki did not explicitly say whether Biden apologized to Macron for failing to give him advance notice about the Aukus defense deal, instead telling reporters, “He acknowledged that there could have been greater consultation.”
3.55pm EDT 15:55
Civil rights attorneys Ben Crump and Antonio Romanucci, who have represented the family of George Floyd, expressed “extreme disappointment” over the collapse of police reform talks in Congress.
“In the last year and a half, we have witnessed hundreds of thousands of Americans urging lawmakers to bring desperately needed change to policing in this country so there can be greater accountability, transparency, and ultimately trust in policing,” the lawyers said in a statement.
“We can not let this be a tragic, lost opportunity to regain trust between citizens and police.”
Crump and Romanucci urged Senate Democrats to bring the George Floyd Justice in Policing Act, which passed the House in March, to the floor “so Americans can see who is looking out for their communities’ best interests”.
3.39pm EDT 15:39
In his own statement on the collapse of the police reform negotiations, Democratic Senator Cory Booker said the talks failed because there was “too wide a gulf with our negotiating partners”.
“We made it clear from the beginning of our negotiations that a bill must ensure true accountability, transparency, and the policing standards necessary to bring an end to horrific incidents of violence Americans are routinely seeing — like the murder of George Floyd,” Booker said.
“After months of exhausting every possible pathway to a bipartisan deal, it remains out of reach right now, even after working collaboratively with and securing the support of policing groups like the Fraternal Order of Police and International Association of Chiefs of Police for our proposals.”
Echoing fellow Democratic negotiator Karen Bass, Booker said the time had come to “explore all other options to achieve meaningful and common sense policing reform”.
“I will not stop fighting until we achieve change that keeps our communities and police officers safe,” Booker concluded.
3.20pm EDT 15:20
Jen Psaki said Joe Biden was “disappointed” that the bipartisan negotiations over the police reform bill collapsed without a deal today.
“Unfortunately, Republicans rejected reforms that even the previous president had supported and refused to engage on key issues that many in law enforcement were willing to address,” Psaki said.
The press secretary noted Biden was “greatly appreciative” for congresswoman Karen Bass and senator Cory Booker’s efforts in the negotiations.
Psaki said Biden would be meeting with members of Congress, law enforcement groups and civil rights advocates in the weeks to come to discuss a path forward, “including potential executive actions” that he can take on police reform.
3.03pm EDT 15:03
Jen Psaki said the White House is “certainly” concerned about the possibility of the government shutting down next week if a funding bill is not approved.
“Until a [continuing resolution] has passed that funds the government, we’ll certainly have a concern,” the White House press secretary said. “But our goal and our focus is on preventing that from happening.”
Noting that the House has already passed a bill to fund the government and suspend the debt ceiling until December, the press secretary expressed hope of the situation being resolved soon.
However, the House-passed bill faces dim prospects in the evenly divided Senate, where Republican leader Mitch McConnell has vowed to block any effort to raise the debt ceiling.
2.48pm EDT 14:48
Jen Psaki was asked about Joe Biden’s meetings today with members of Congress to discuss the bipartisan infrastructure bill and the $3.5tn reconciliation package.
One reporter pressed Psaki on whether this marks a “make or break” moment for the two bills, which encompass much of the president’s economic agenda.
The press secretary declined to characterize the meetings in that way, instead saying, “This is an important moment. We are in a pivotal period in our negotiations and discussions.”
2.32pm EDT 14:32
One reporter asked Jen Psaki whether Joe Biden apologized to Emmanuel Macron for how the Aukus deal was announced.
“He acknowledged that there could have been greater consultation,” the White House press secretary said. “There was agreement that we wanted to move forward in our relationship.”
Asked if Biden held national security adviser Jake Sullivan responsible for the dust-up with France, Psaki replied, “He holds himself responsible.”