Via BofA:
Fiscal cliff economics
• Many pandemic-aid programs in the CARES Act are set to expire at the end of the year without action from Congress.
• The expiration of federal UI programs—PUA and PEUC—alone could be a drag of 1.5pp in 1Q. Cutoff of other provisions will be additional headwinds.
• We expect Congress to pass another package of $500bn-$1tn in early 1Q which should offset the drag and support growth into 2Q.