- Washington is bracing for its first government shutdown since 2018, a standoff that could disrupt economic data releases and potentially complicate the Fed’s policy decisions. Wall Street is uneasy, with UBS’s Paul Donovan warning the lack of official data could let rumor and unreliable surveys sway markets, while companies quietly push through price hikes. Still, UBS and Macquarie analysts argue the macroeconomic impact is usually small and temporary—unless the shutdown drags on or Trump follows through on threats to permanently cut furloughed workers.
Washington seems fairly resigned to the fact a government shutdown will begin at midnight, the first to occur since 2018. Of course, this could be feigned acceptance to call the bluff of political opposition—or it could be a true reflection of the stalemate within Congress. Whatever the reason, Wall Street is caught in the middle.
