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Goldman Sachs: Government Shutdown Highly Likely by October 1st Deadline, Prolonged Closure Could Stall Economic Growth

  • Goldman Sachs sees a 90% chance of a government shutdown by October 1 deadline
  • A shutdown could delay key economic data used by the Fed for monetary policy decisions
  • Most likely scenario is shutdown on October 1 according to Goldman Sachs economists
  • Even if resolved this week, another shutdown still likely by December 31 funding deadline
  • Prolonged shutdown could cut 1.2 percentage points from Q4 growth per Moody's chief economist
yahoo.com
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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 has reduced its probability of a U.S. recession in the next 12 months to 15%, citing positive developments in inflation and the labor market, while Bloomberg's consensus of economists estimate a recession probability of 60%.
A potential government shutdown could have limited impact on the stock market, but could reduce economic growth by 0.15 percentage points per week and potentially cut 1.2 percentage points from fourth-quarter growth; however, the market tends to be unaffected by shutdowns and is more influenced by corporate developments and macroeconomic factors.
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 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.
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.
With just over a week until Congress hits their deadline, the possibility of a government shutdown grows as House Republicans remain divided on spending negotiations.
Investors shouldn't worry about a government shutdown as it is unlikely to have a significant impact on the markets.
The US government faces a potential shutdown if Congress fails to agree on funding past September 30, which would be the first shutdown since December 2018 and could result in a longer standoff between parties.
Millions of federal employees and military personnel face the prospect of a government shutdown, which would result in financial hardships for American families, disruptions in services, and potential harm to the economy.
The federal government is likely to face a shutdown that will affect various services, disrupt workers' pay, and create political turmoil as Republicans demand deep spending cuts.
The federal government is at risk of shutting down on October 1 if a last-minute spending deal is not reached, potentially leading to delayed paychecks for millions of federal workers and negative effects on the economy, according to the AP.
A U.S. government shutdown would negatively impact its credit assessment and highlight the weakness of its institutional and governance strength compared to other top-rated governments, according to Moody's, although the economic impact would likely be short-lived.
The federal government is on the verge of a shutdown, with potential consequences for various areas of governance.
The possibility of a government shutdown in the U.S. could have negative implications for the crypto industry's regulatory progress and projects, similar to the effects seen in the previous shutdown in 2018 and 2019, with delays in approvals and a withdrawal of a bitcoin ETF application.
The U.S. is on the verge of a government shutdown as Congress debates spending levels and aid to Ukraine, which could potentially affect government operations and federal workers' paychecks.
The impending government shutdown may have an impact on the financial markets, according to Kristina Hooper, Chief Global Market Strategist at Invesco.
A brief government shutdown is unlikely to significantly slow down the economy, but a prolonged shutdown could hurt growth and potentially impact President Biden's re-election prospects.
A government shutdown in the U.S. could cause significant disruptions in the stock and bond markets, with the Securities and Exchange Commission being forced to furlough most of its staff and leaving the market oversight at a "skeletal" crew level.
A government shutdown would severely impact the U.S. Securities and Exchange Commission's ability to approve IPOs and respond to market turmoil, according to its chair, Gary Gensler.
Goldman Sachs' chief economist predicts that the U.S. government is likely to face a two-to-three-week-long shutdown beginning on October 1 due to the failure to reach an agreement on annual budget legislation.
The U.S. government is facing a potential shutdown if Congress does not resolve a deadlock by this weekend, which would result in furloughs or unpaid work for federal workers and military employees, but experts believe the impact on the economy and stock market will be short-lived.
A government shutdown is looming as lawmakers have until the end of the day Saturday to reach a deal or the U.S. will face one of the largest government shutdowns in history, impacting millions of workers and services.
A government shutdown could lead to disruptions in food aid, air travel, and financial markets, and increase the risk of cyber attacks on critical financial infrastructure, according to Karen Petrou of Federal Financial Analytics Inc.
US Treasury Secretary Janet Yellen warns that a government shutdown could lead to a recession, with immediate harm and long-term repercussions for the economy.