“I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business,” Trump wrote on Twitter a day after emerging from a hospital stay for COVID-19 treatment.
Trump’s surprise move came after U.S. House of Representatives Speaker Nancy Pelosi on Sunday said during an interview with NBC’s “Face the Nation” that progress was being made in her negotiations with the Trump administration on a bill to build on the more than $3 trillion in coronavirus aid enacted into law earlier this year.
Earlier on Tuesday, Federal Reserve Chair Jerome Powell told a business conference the U.S. economic expansion was “far from complete” following the deep contraction stemming from the coronavirus pandemic.
A failure by the United States to provide further relief, Powell warned, “would lead to a weak recovery, creating unnecessary hardship for households and businesses.”
Following Trump’s announcement breaking off negotiations, U.S. stocks were down more than 2 percent in late afternoon trading.
In recent days, financial markets were hopeful progress toward a COVID-19 vaccine and another round of economic stimulus from Congress would boost the U.S. economy, which has been showing signs of renewed weakness.
Pelosi and Treasury Secretary Steven Mnuchin had been talking regularly over the past week or so as they attempted to narrow the gap between a recent Democratic call for around $2.2 trillion in new spending to battle the pandemic and bolster the economy, versus around $1.6 trillion sought by the administration.
It was not clear whether enough Senate Republicans would have gotten behind any deal, however.
Pelosi aides were not immediately available for comment.
(Reporting by Doina Chiacu, Tim Ahmann, Richard Cowan and Susan Cornwell Editing by Chizu Nomiyama and Chris Reese)