We have the details on every major provision in the Senate-passed Inflation Reduction Act. We’ll also look at improving consumer inflation expectations, the most recent Ukraine aid package and plummeting gas prices.
But first, see why some are wary of Trump’s toilets.
Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom. Someone forward you this newsletter? Subscribe here.
Here’s what’s in the Inflation Reduction Act
The Senate passed Democrats’ Inflation Reduction Act on a party-line vote Sunday afternoon, delivering the long-awaited centerpiece to President Biden’s agenda.
Democrats rallied behind the $430 billion climate, health care and tax overhaul after Senate Majority Leader Charles Schumer (D-N.Y.) reached a last-minute deal with Sen. Joe Manchin (D-W.Va.), who had held up previous proposals.
- The bill aims to bring down energy bills by offering consumer incentives to install renewable systems such as solar panels and buy electric cars.
- It will cap the price of popular prescription drugs, but largely only for Medicare patients, due to an unfavorable parliamentarian ruling.
- The bill pays for climate and health care provisions by imposing a 15 percent minimum tax on large corporations, boosting IRS enforcement, taxing stock buybacks and limiting deductions wealthy individuals can take.
The Hill has all the details here.
Read more about the Inflation Reduction Act:
- There are some clear winners and losers from the sweeping bill
- Senate Democrats stuck together to pass the spending package
- The White House worked behind the scenes to push for the plan
Consumer expectations for inflation improve in July
Consumers’ inflation expectations improved in July amid plummeting gas prices and rising interest rates, according to a New York Federal Reserve survey released Monday.
Respondents expect the inflation rate to average 6.2 percent over the next year, a sharp drop from 6.8 percent in June’s survey. Expectations for the three-year inflation rate fell from 3.6 percent to 3.2 percent over the same period.
- The decline is driven by improving consumer sentiment on gas prices, with gas prices expected to rise just 1.5 percent over the next year.
- Consumers are also optimistic about food and housing prices coming back to reality.
- The survey showed drops in expected inflation, but the 6.2 percent one-year figure is still higher than in March of this year.
Karl has more here.
MORE UKRAINE AID
US to provide additional $4.5 billion to keep Ukrainian government operating
The U.S. is sending out an additional $4.5 billion in aid to the government of Ukraine, bringing the total amount of budgetary support to the country since it was invaded by Russia to $8.5 billion, the Treasury Department said Monday.
The funds will help keep the Ukrainian government afloat as it seeks to withstand the large-scale Russian military campaign that’s now approaching its sixth month. The first payment of $3 billion from the $4.5 billion is scheduled to go out later this month.
- The money will go toward paying government salaries, keeping hospitals and schools operating and distributing humanitarian supplies.
- It’s the fifth disbursement from the U.S. directly to the Ukrainian government budget. The U.S. sent $1 billion through the World Bank in April and May,
$1.3 billion in June, and another $1.7 billion in July.
Tobias Burns has more here.
National average price of gas expected to fall below $4: GasBuddy
The national average price for a gallon of gas fell to $4.01 on Monday and is expected to imminently fall below $4, according to estimates by GasBuddy.
Gas prices have fallen for eight consecutive weeks after briefly peaking at a record high of more than $5 per gallon in mid-June, according to the gas price tracker’s analysis. AAA reported a nationwide average of $4.059 per gallon on Monday.
“The national average is poised to fall back under $4 per gallon as early as today as we see the decline in gas prices enter its eighth straight week,” Patrick De Haan, GasBuddy’s head of petroleum analysis, said in a statement.
Good to Know
A majority of Black, Native American and Latino households are struggling with serious financial problems amid a 40-year high inflation rate, according to a new poll from NPR, the Robert Wood Johnson Foundation and Harvard’s T.H. Chan School of Public Health.
About 58 percent of African Americans, 69 percent of Native Americans and
56 percent of Latinos report struggling with serious financial problems due to inflation. Among white households, that number is 44 percent, while only 36 percent of Asians report struggling with serious financial problems.
Here’s what else we have our eye on:
- Another 500 flights were canceled in the U.S. on Monday following a tough weekend that saw more than 1,500 flights canceled across the country.
- The Treasury Department imposed sanctions against cryptocurrency mixer Tornado Cash for helping hackers launder more than $7 billion worth of virtual currency since it launched in 2019.
That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow.
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