The US Treasury Secretary, Steve Mnuchin has decided not to extend the emergency lending program after 31 December 2020. This decision taken by the Treasury Secretary will reduce the Fed's ability to provide support to the financial system of the US. Mnuchin's letter to the Fed stated that unused funds need to be returned to the Treasury.
t is believed that the current decision could be revised in the future either by Mnuchin himself or by the new Treasury Secretary under the Biden government. The decision to cut the extension of programs will leave the Biden government with less financial backup to restart programs. It would be critical to watch how Mnuchin’s decision will turn out for the economy at the time when the stimulus is the most needed resort.