(Reuters:) Goldman Sachs (NYSE 🙂 has lowered its quarterly GDP estimates for 2022 after U.S. President Joe Biden’s announcement. Senator Joe Manchin resigned his support for the $1.75 trillion domestic investments bill by U.S. President Joe Biden.

Manchin is a moderate Democrat and appeared to strike a blow to Biden’s Build Back Better policy bill (BBB). This bill aims to increase the social safety net as well as combat climate change.

Jan Hatzius, a Goldman Sachs analyst, wrote that he had anticipated a negative fiscal stimulus for 2022 due to the loss of support for COVID-relief legislation in 2020 and 2021. “Without BBB, this fiscal impulse could become more negative than what we expected,” he said in a Sunday note.

Hatzius decreased the U.S. GNP forecast for Q1 2022 by 2% from 33%. This was without considering that BBB would become law. Hatzius also reduced Q2 forecast to 3.5% from 3.5% and Q3 outlook to 2.55% from 3%.

Hatzius stated that BBB, in its present form, is unlikely. However there are still good chances for Congress to enact a smaller number of fiscal proposals dealing manufacturing incentives and supply-chain issues.

Goldman Sachs believes that Congress may extend the child tax credit program, which provides free childcare with some modifications. However, “the chances of this happening are lower than even.”