Americans are growing increasingly anxious about the possibility of another government shutdown, with concerns about the impact on the economy and essential programs such as child care and fishing quotas.
Goldman Sachs has lowered its probability of a U.S recession in the next 12 months to 15% due to positive inflation and labor market data, while also predicting a reacceleration in real disposable income and expecting the Federal Reserve to keep interest rates unchanged.
Wall Street closed August with declines, marking the worst month for the Dow, S&P 500, and Nasdaq Composite since earlier this year, while weak economic data and a cooling labor market have raised hopes that the Fed will maintain interest rates and provide growth opportunities for growth stocks like NVIDIA, Caterpillar, Amazon, Splunk, and Royal Caribbean Cruises.
There is a significant chance of a government shutdown as lawmakers on Capitol Hill are divided on reaching a resolution, with Senator Ted Cruz suggesting that President Biden and Senator Schumer may want a shutdown for political gain.
Goldman Sachs is reportedly planning to lay off around 1% of under-performing employees as early as next month, marking the fourth round of cuts at the bank since last fall, as the firm aims to address the decline in net profit and compensate for the impact of the COVID-19 pandemic.
Former House Majority Leader Eric Cantor advises Republican colleagues not to pursue a government shutdown unless they have a clear plan to come out as winners, citing the failed attempt to block Obamacare in 2013 as a major political headache that did little to hinder its rollout.
The potential government shutdown threatens to deprive the Federal Reserve of crucial data on the labor market and inflation, which could hinder its ability to make informed decisions about the economy and interest rates.
Americans are feeling uncertain about the economy's direction and are starting to worry about a possible government shutdown, as consumer sentiment dips in September due to concerns about inflation and higher gas prices.
Despite rising gas prices, Americans remain optimistic about inflation easing, as expectations for inflation rates in the year ahead have fallen to the lowest level since March 2021, according to a consumer sentiment survey from the University of Michigan. However, concerns are surfacing about a potential government shutdown, which could dampen consumer views on the economy.
Goldman Sachs warns that three factors - the resumption of student loan payments, the autoworkers' strike, and a potential government shutdown - could lead to a significant slowdown in US GDP growth during the fourth quarter of 2023.
Lawmakers are dealing with a potential government shutdown as oil prices rise above $90 per barrel and housing data is expected, all ahead of the September FOMC meeting where the trends in inflation and the housing market will influence the Fed's decision on interest rates.
Treasury Secretary Janet Yellen believes that there are no signs of an economic downturn, but warns that a government shutdown could undermine economic momentum.
The White House warns that a government shutdown at the end of the month could have damaging consequences for the economy, national security, and the American public.
US stock futures rise as investors await Fed decision on rates; US debt rises to $33 trillion as government shutdown looms; Federal Reserve expected to pause rate hikes; Impact of government shutdown, autoworkers strike, and rising oil prices on the economy; Biden reshapes the Federal Reserve.
A full government shutdown in the US is likely at the end of the month, which could impact the Federal Reserve's decision to raise interest rates in November, according to analysts at PIMCO.
