CREDIT SUPPLY: BMW (BMW A2/A/NR): Final Terms

Senator Josh Hawley (R-MO) is calling for the child tax credit to increase from $2,000 to $5,000 per child, according to Axios. The plan, which tracks with a campaign proposal outlined by Vice President-elect JD Vance, could cost $2 trillion-$3 trillion over 10 years, setting up a potential confrontation with deficit hawks next year. 

• Axios notes the plan "complicates the math next year for incoming Senate GOP leader John Thune and Speaker Mike Johnson, who also face a fight over the $10,000 cap on state and local tax deductions (SALT).”
• Hawley said: "...people with families are who elected Donald Trump, and we need to deliver real and meaningful tax relief to them." On the cost of the programme, Hawley said his plan would be "fantastic for the economy."
• Politico notes: "...while Hawley is not proposing to make the credit fully refundable, he is proposing to apply it against payroll taxes as well as income taxes."
• The Wall Street Journal reports: “Tax cutters are beating deficit hawks in the early phases of the Republican Party’s fiscal tug of war... And GOP lawmakers are leaning into the contentious idea that some of their tax cuts would generate enough growth to largely pay for themselves.”
• The Journal adds: “The fight is still in its first rounds... They may offset some tax cuts by limiting clean-energy tax credits and cutting spending outside Social Security and Medicare.”

• Justin Trudeau's efforts to encourage Donald Trump to lift the threat of a 25% tariff have been set back by the resignation of his finance and housing ministers, Canadian Federation of Independent Business Vice President Corinne Pohlmann told MNI.

• In the FI space, the current bearish cycle in Bund futures remains in play and the contract continues to trade closer to its recent lows. Sights are on 133.98, 61.8% retracement of the Nov 6 - Dec 2 bull cycle. Clearance of this level would strengthen the current downleg. For bulls, a reversal higher would highlight the end of the correction. First key resistance to watch is 136.01, the Dec 12 high.
• A strong bearish theme in Gilt futures remains in play and today’s gap lower reinforces current bearish conditions. The move down has resulted in a breach of key short-term support at 93.40, the Nov 18 low. A break of this level strengthens the bear condition and highlights a stronger reversal. Sights are on the 93.00 handle. Initial firm resistance is at 95.05, the 20-day EMA. The contract is oversold, short-term gains would be considered corrective. First resistance is 93.87, the Dec 16 low and gap high on the daily chart.