Congress has not yet passed any appropriations measures, which makes a full suspension more likely than a partial one.
According to Bank of America, even if it starts next week without accepting financing, the negative impact will be moderate.
The betting markets estimate the probability above 65%. Although historically, the effects on the market have been negligible. Previous suspensions reduced GDP by only 0.1 percentage points per week, with growth usually recovering as employees on leave were paid later. The main services continue to operate, from air traffic control to social security.
The main problem is the suspension of publication of economic data. The extended break will leave the Federal Reserve relying on private research just weeks before its meeting at the end of October, making policy decisions more uncertain.
However, this time the White House instructed departments to prepare for permanent staff reductions, not just temporary vacations.
This could negatively affect hiring in Washington, where the local labor market is already weaker than the national average. Any sustained cuts will make the growth hit harder to repair.
Markets are unlikely to react much, as past suspensions have barely affected Treasury yields or the dollar. Stocks declined in 2018, but this was due more to the tightening of Federal Reserve policy than to the budget impasse.
Bank of America notes that risky assets, interest rates and the foreign exchange market usually calmly endure suspensions, while the money market remains unaffected. Unlike debt ceiling disputes, there is no threat of default.
But BofA analysts said the bigger risk is political. Another budget impasse reinforces the perception of a dysfunctional fiscal process.
Rating agencies have already downgraded the US rating due to balancing on the brink of default, although never because of the government shutdown.
This may change if investors conclude that Washington's fiscal paralysis has become chronic. So far, government funding disruptions are more of a nuisance than a crisis, but they undermine confidence in America's ability to govern itself.