The Economic Consequences of a Threatened Government Shutdown

If lawmakers fail to pass a budget or extend the deadline, a government shutdown could occur on Oct. 1, which would have several negative impacts on the economy. Federal workers would be furloughed, leading to reduced spending, and some services would be halted. Homebuyers could face delays in obtaining government-backed mortgages, and mortgage rates may rise due to a potential downgrade in the U.S. credit rating. Additionally, a shutdown would leave the Federal Reserve without crucial economic data, making it difficult for policymakers to make informed decisions.