Budget cut agreement failure hits US economic outlook

On Monday Republicans and Democrats announced they did not manage to approve the proposal of budget cuts in order to reduce national deficit by $1.2 trillion in next 10 years. The failure reflects US inability to put his financial system in order. US gridlock come in inappropriate time amid Europe's struggle to end debt crisis. Additionally deadlock implies uncertainty whether officials will support payroll tax reductions or enlargement of unemployment allowances to stimulate US economy.