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U.S. Government Shutdown & Its Impact on Business

Stockhouse Editorial
0 Comments| January 11, 2019

As the U.S. government enters its 21st day partially shut down, the expectation among analysts and experts is that the economy is being gradually eroded and weakened … but even data on just how damaging the effects are remains elusive.

An article published and distributed Friday morning by the Associated Press found that key reports on growth, spending and hiring have been stalled. In addition to home construction data being delayed, a report on the economy’s overall growth that was scheduled for the end of January won’t be published on time so long as the shutdown continues.

Coupled with the ongoing wear down of the global economy as the trade dispute with China continues, there are fears the U.S. economy could stall aggressively in the coming months, which would be bad news for Wall Street as markets were hit hard last year and interest rates were pushed higher four times.

This ties the longest halt in federal funding and as hundreds of thousands of American workers miss paycheques, it is estimated by financial services company S&P Global that the closure had an economic effect of roughly $3.6 billion as of Friday. It expects the shutdown to cut about $1.2 billion (0.05%), off quarterly GDP growth for each week that it drags on.


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