Goldman Sachs Forecasts High Probability of Government Shutdown in 2021

Goldman Sachs predicts that a government shutdown is "more likely than not" to occur this year due to a slim House majority and disagreements on key spending issues. The consequences of a shutdown are expected to be less severe than those of failing to suspend the debt limit, making it more likely that Congress fails to act in time. The report also highlights the challenge of passing spending bills before the end of the fiscal year, with Ukraine funding being a major hurdle. A government shutdown at the end of the year could reduce economic growth by about 0.2 percentage points per week.