IMF Warns of Economic Risk of US Government Shutdown

• IMF expresses concern over the potential U.S. government shutdown as an avoidable risk.
• Urges parties to reach a consensus on federal government funding.
• Congress must pass legislation by Saturday midnight to avert a shutdown.
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The International Monetary Fund (IMF) expressed concern on Thursday about the potential shutdown of the U.S. government, describing it as a risk that could have been prevented.

The IMF called for parties to agree on maintaining funding for the federal government.

To prevent the furloughs of hundreds of thousands of federal employees and the suspension of various essential services, including economic data releases and nutrition benefits, Congress needs to pass legislation that can be signed into law by President Joe Biden before midnight on Saturday (0400 GMT on Sunday).

This would mark the fourth government shutdown in the past decade.

House Republicans, primarily led by a small faction of far-right members in their 221-212 majority-controlled chamber, have rejected the spending levels for the fiscal year 2024 that were agreed upon in a deal negotiated between McCarthy and Biden back in May.

Kozak did not provide any additional information regarding the potential consequences of a government shutdown on the U.S. economy and did not comment on the strike organized by the United Auto Workers against the three major Detroit automakers.