At the conclusion of its policy meeting at 2 P.M. EST, The Federal Reserve is expected to raise its benchmark interest rate by three-quarters of a percentage point for the second straight meeting in an effort to tamp down inflation that’s been running at a four-decade high. The rate-setting Federal Open Market Committee is almost certain to deliver a three quarter of a percentage point increase in its overnight target rate range, lifting it to between 2.25% and 2.5%. Based on comments by Fed officials, it won’t be the final level in a campaign aimed at combating the worst levels of inflation seen in four decades.
The Senate just passed bipartisan legislation to help the U.S. compete with China by injecting tens of billions of dollars into the domestic production of semiconductor chips. The bill, known as the CHIPS-plus or Chips and Science Act, passed in a 64-33 vote. It will now head to the House, where lawmakers hope to pass it and send it to the White House for President Joe Biden’s signature before Congress leaves town in early August. Yesterday, the Senate voted 64-32 to invoke cloture, limiting debate on the measure and teeing it up for final passage today after they voted on a budget point of order that Senator Bernie Sanders, (I-Vermont) raised. The bipartisan bill will pave the way for providing nearly $280 billion in various incentives for U.S-based chip making. The bill has three major incentives for chipmakers: $52 billion of assistance in setting up fabs and manufacturing units, which also includes $2 billion for legacy chipmaking essential to the auto and defense industry; 25% in tax relief for investment in local semiconductor manufacturing; and $200 billion for grants for research in the area.
The Senate is also expected to vote on cloture on a bill on aid for veterans exposed to toxic substances. The House most recently passed the PACT Act on July 13th by a vote of 342-88, about a month after the Senate passed the bill by a bipartisan 84-14 vote. The upper chamber must pass the measure again, as the House version of the bill includes technical changes from the measure passed last month. The bill then heads to President Biden’s desk, where he is expected to sign it. Among its provisions, the bill would expand the Department of Veterans Affairs’ (VA) presumptions of service-connected illness related to Agent Orange exposure for those who were exposed in Thailand, Cambodia, Laos, Guam, American Samoa and Johnston Atoll.
The House convened at 10:00 A.M. and began work on a series of bills including H.R. 4990 – ITS Codification Act, H.R. 3771 – South Asian Heart Health Awareness and Research Act of 2022, H.R. 4040 – Advancing Telehealth Beyond COVID–19 Act of 2022 and H.R. 6929 – Susan Muffley Act of 2022.
The House will also consider up to 12 postponed bills under suspension of the Rules.
Adam S. Olsen, Washington, D.C.
