For the first time in 17 years, the US federal government was forced to shut down some of its activities.
In fact, by 1 October, with the beginning of the fiscal year, the House (with a Republican majority) and the Senate (with a Democratic majority) should have reached an agreement on the budget to be prepared for the new fiscal year. However, consensus was not reached on the issue of health care reform: the Senate rejected (with 54 votes against 46) the House's proposal to postpone the start of health care reform by one year.
The failure to reach an agreement on the budget had the immediate effect of the closure of services deemed non-essential (e.g. museums, zoos), and the consequent impact on the workers employed in these activities (about 800.000), who were furloughed or required to continue to work without receiving salary.
If an agreement cannot be found soon, there will be an economic slowdown and an upward shock to interest rates. A roughly four-week freeze is estimated to reduce US GDP growth forecasts for 2013 to 0,1% versus 1,5% expected.
The political impasse raises concerns about another "key" issue of the US economy: the raising of the permitted public debt ceiling. To date, this ceiling is set at 16,7 trillion dollars, against an effective debt of approximately 16,1 trillion dollars (corresponding to 99,2% of GDP). On 17 October the extraordinary measures which the government has resorted to to date to honor debt services will end: if a new threshold is not set by that date, the United States could declare default.
The impact of this situation of uncertainty on the financial markets reduced the benefits that had been obtained with the Federal Reserve's decision to postpone the tapering of the unconventional monetary policy adopted (QE3) with respect to the September hypothesis.
