Treasury Secretary Steven Mnuchin said Thursday that the White House won’t let differences over funding targets for Covid-19 testing derail stimulus talks with top Democrats.

House Speaker Nancy Pelosi, the lead negotiator for Democrats, had identified testing as one of the main sticking points in talks.

“That issue is getting overblown,” Mnuchin tol CNBC’s “Squawk Box.” “We’ve agreed to $178 billion overall for health. It’s an extraordinary amount of money. We’d agreed with the Democrats with $75 billion going to testing, contact tracing.”

“What we have been focused on is the language around testing,” he added. “When I speak to Pelosi today, I’m going to tell her that we’re not going to let the testing issue stand in the way. We’ll fundamentally agree with their testing language subject to some minor issues. This issue is being overblown.”

His comments came minutes after the Labor Department’s jobless claims report added to concerns that the recovery U.S. labor market may be slowing.

The department reported that the number of first-time applicants for state unemployment insurance rose to 898,000 during the week ended Oct. 10. That total was the highest number since Aug. 22.

The public health crisis also shows few signs of abating, adding urgency to calls for further federal intervention.

Daily new U.S. cases of the coronavirus, as a seven-day average, continued to rise and topped 52,345 as of Wednesday, according to a CNBC analysis of Johns Hopkins data. Average daily new infections are 17% higher than a week ago and have been growing for the last 10 days.

Mnuchin’s comments clarifying the White House’s thoughts on funding for testing could provide some hope for the talks.

Negotiations between the White House and Congress have been deadlocked for weeks, but the prospects for a deal before the 2020 election appeared to dim on Wednesday after a spokesman for Pelosi highlighted testing as a key difference between the two sides.

“One major area of disagreement continues to be that the White House lacks an understanding of the need for a national strategic testing plan,” spokesman Drew Hammill wrote on Twitter. “The Speaker believes we must reopen our economy & schools safely & soon, & scientists agree we must have a strategic testing plan.”

Pelosi, whose party passed a $2.2 trillion relief bill in the House, has criticized the White House’s latest $1.8 trillion proposal as insufficient.

The comments from the Treasury secretary and the speaker earlier in the week weighed on equities on Wednesday, when the Dow lost 160 points and the S&P 500 shed 0.7%. U.S. stocks appeared set for their third straight day of losses Thursday morning as Dow futures sunk nearly 300 points and S&P 500 contracts lost 1%.

President Donald Trump said he had scrapped stimulus talks earlier this month until after the election, but he later reversed course and called for a big relief package as his Democratic challenger, Joe Biden, extended his lead in national polls.

Meanwhile, the White House and Senate Republicans appear more out of sync over fiscal support. Senate Majority Leader Mitch McConnell, R-Ky., has said he favors a far smaller deal than either the White House or Democrats advocate.

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