The US administration and opposition Democrats in Congress have agreed on a financial plan they hope will save the country from recession. With Treasury Secretary Henry Paulson at his side, President Bush announced a package that would offer tax rebates to the public aimed at stimulating the purchasing power of America’s middle class.
Individuals would receive just over 400 euros, and families an extra 200 euros for every child. Businesses would also benefit, pumping a total of around 100 billion euros into the US economy.
The plan may be amended in the Senate, but it is hoped the final version could be on Bush’s desk by mid-February. It comes two days after the Federal Reserve made its biggest single cut in US interest rates for 25 years.
Economists fear that amid rising fuel prices, the mortgage and credit crisis will spread to the high street and cause a recession that will in turn infect global economies.