FXStreet reports that Michael Zezas, Head of Public Policy Research and Municipal Strategy for Morgan Stanley, explains why two D.C. policy items - the bipartisan infrastructure framework and debt ceiling deliberations - could add one more complication for equities markets.

“This vote is a key test for whether or not the Democrats will be able to 'go big' on fiscal policy. At the moment, it's far from clear that the BIF can get enough votes to pass on its own, meaning the 'all or nothing' dynamic on fiscal policy remains intact. But if the BIF succeeds, that would suggest a smaller fiscal package, smaller deficit impact, and a key challenge to our view that bond yields will rise meaningfully into year-end.”

“While we ultimately expect these issues to be resolved in a manner that doesn't materially impact the US growth outlook, the path to resolution on these issues likely requires escalated uncertainty in the near term... ...headlines around a government shutdown should pick up, and with it the takes that the situation increases the risk that the debt ceiling can't be raised in a timely manner.”