Senate Approves $3.3 Trillion Tax Bill Amid Market Volatility

The U.S. Senate narrowly approved the $3.3 trillion "Big and Beautiful Act" with a vote of 51 to 50. This legislation, proposed by President Trump, encompasses a broad tax reduction and expenditure plan. The bill is anticipated to undergo a vote in the House of Representatives later this week. While Republicans view this bill as a strategic advantage for the upcoming elections, public opinion polls indicate limited societal backing, and some Republican legislators hold uncertain positions, casting doubt on the final outcome.

Market analysts have noted that the passage of this bill could exacerbate the fiscal deficit and intensify pressure on the Federal Reserve to sustain elevated interest rates. In the immediate term, the U.S. dollar exhibits slight weakness, and cryptocurrency markets are experiencing volatility. The bill's potential impact on the U.S. bond supply and subsequent market reactions are critical factors to monitor.

According to the analyst's forecast, if the bill is enacted, the trajectory of the U.S. dollar will significantly influence short-term risk sentiment. Investors are advised to cautiously manage their positions and await a clearer market direction. The outcome of the House vote and the market's response to the increased pressure on U.S. bond supply will be pivotal in shaping the near-term economic landscape.