OHIO — Lawmakers in Washington, D.C. approved a two-part federal spending plan to avoid a government shutdown and disruption to holiday travel.
Yet, some experts said the struggle to sign off on a full spending bill will likely resurface again early next year. This comes as Republicans and Democrats have been divided for some time on what should be funded and what should be cut.
What You Need To Know
- Experts believe the probability of a government shutdown occurring in 2024 has gone up
- Experts also believe there is clear evidence that inflation is cooling
- This means consumers could see some relief at the gas pump and with heating bills
“I think lawmakers are going to be forced to go from wanting to get a more permanent thing, you know, spending goal done, to actually being forced to get something done," said Brandon Zureick, managing director and portfolio manager at Johnson Investment Counsel.
He added that based on last year’s problems of dealing with the debt ceiling, he believes lawmakers are going to want to avoid that from happening.
“But the odds of a government shutdown happening next year have probably gone up," he said.
While there’s temporary relief, Zureick believes “we're starting to get pretty convincing evidence that inflation is cooling," noting that this is good news for investors.
Still, he said prices for goods are still higher compared pre-COVID days and they're still increasing, which consumers can’t ignore when looking at the impact on their wallets.
Knowing this, Zureick believes there is a bit of silver lining in that the cost to heat your home or fill up your gas tank has dropped “between 5% and 20% versus this time last year, so maybe a little bit of relief for consumers.”
The reality for consumers, though, is that they shouldn’t expect significantly cheaper deals at the grocery store for the holidays.
In the meantime, while the spending bill has staggered expiration dates in January and February, Zureick expects the government will shutdown on the January date, which would prolong keep a long-term solution hanging in the balance until February’s expiration.