What Happens During a US Government Shutdown?

Talk of a U.S. government shutdown is again in the air. Funding for the vast menu of federal activities, foreign and domestic, is due to run out after Dec. 8, and Republicans and Democrats in the U.S. Congress are negotiating a spending bill to carry beyond that date. Without a deal, the U.S. will encounter what’s officially called a “spending gap,” which triggers a carefully prescribed, but still disruptive, halt to Washington’s work.1. Why might the government shut down on Dec. 8?Since Oct. 1, when the 2018 fiscal year began, the U.S. has been operating on temporary funding provided by a “continuing resolution” passed by Congress and signed by President Donald Trump. It runs through Dec. 8, and leaders in Congress are negotiating an extension. At the same time, they’re juggling demands from various factions in both parties to stabilize insurance markets, extend a program to protect from deportation some young people brought to the U.S. illegally as children, and raise budget caps for defense spending.

Source: What Actually Shuts Down During a U.S. Government Shutdown – Bloomberg

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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.