by Shane Oliver, Head of Investment Strategy & Chief Economist
- The partial US Government shutdown is likely to continue until there is a joint solution to the shutdown and approaching debt ceiling later this month.
- The debt ceiling poses the greater risk to the US (and global) economy given the risk of debt default by the US.
- However, the most likely outcome is a last minute increase in the debt ceiling. And in any event a debt default is unlikely.
- Shares are vulnerable in the short term as uncertainty intensifies, but are likely to rally solidly into year-end once a solution to the debt ceiling is in place.
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