While Washington will undoubtedly be focused on the Russian invasion of Ukraine, the work of government will proceed with a busy few weeks ahead both for the White House, Congress, and the Fed.
Tuesday President Joe Biden will address a joint session of Congress to deliver his first State of the Union speech. The evening should be dramatic as a loosely organized group of truckers has vowed to disrupt the proceedings with a caravan mimicking the Canadian truckers who shut down Ottawa. Washington seems well prepared after the shock of January 6, but access to the Capitol will be limited.
The President will address Congress and the nation at a time of global tensions over the Russian invasion of Ukraine. The invasion should add a bipartisan nature to the address as the nation appears united in condemnation of Russia and support for Ukraine. There is talk of an emergency package for Ukraine and I expect the idea to get attention from Biden and big-time bipartisan support at the SOTU speech.
The President also speaks at a time when the Covid crisis appears to be waning, and SOTU gives Biden the opportunity to try and put the issue, which has given both Biden and Trump so many problems, into the rearview mirror.
Obviously, the President will have to outline his plans for the economy as concerns with inflation tops all the polls as a difficult issue for Democrats with the approaching midterm elections. Many will be anxious to see what he says about the Build Back Better (BBB) which appears dead and how he frames the path forward for economic programs that were included in BBB.
Next week will also see Fed Chair Jay Powell give the semiannual report to Congress on monetary policy. Powell will testify on Wednesday before the House Financial Services Committee on Thursday before the Senate Banking Committee. This will likely be his last public statement before the FOMC meets in mid-March.
The appearance before the Senate Banking Committee has its own tension as the Committee Republicans blocked action on the nomination of Powell for a second term, and the nominations of three candidates to fill vacant Board seats, when they boycotted the hearing scheduled before the Presidents Week break to approve the nominations. Republicans reportedly support Powell for chair but oppose one of the three new Board members, Sarah Bloom Raskin, and viewed the boycott as a way to block the confirmation. March 11 is the new deadline for Congress to pass a funding bill for the fiscal year that began on October 1, 2021; there have been staff negotiations over the break and the next two weeks will be crunch time for Congress to reach spending agreements.
