Wall Street powerhouse Goldman Sachs is warning investors of a potential government shutdown next month resulting from President Donald Trump’s falling approval rating.
“Presidential approval continues to decline, and is the lowest for any first-term president in his first year in office,” economist Alec Phillips warned clients Friday. “Low approval ratings raise legislative risks. In the near term, we believe there is a 50% chance of a brief government shutdown, as the president seeks to solidify support among his base by embracing more controversial positions.”
Gallup reported Friday that 57 percent of Americans disapprove of President Trump.
The United States Treasury has warned Congress that the debt ceiling must be raised by Sept. 29 to avoid a shutdown.
Goldman Sachs also warned that tax reform may be in jeopardy.
“We continue to believe a tax cut is slightly more likely than not, but our conviction is low, as there has been little progress to date,” the briefing noted. “If tangible progress has not been made by October, after these fiscal deadlines have passed, tax legislation will start to look less likely, in our view.”