US Government Shutdown Looms
 

With neither full-year appropriations bills nor a continuing resolution (CR) providing temporary funding in place, it’s quite possible the US government will at least partially shut down when the federal fiscal calendar flips to 2026 at midnight tomorrow.

The lack of progress on regular appropriations this late in the game is not unusual; Congress has passed the 12 funding bills before the start of the fiscal year only three times since 1977, most recently for 1997.¹ To avoid the disruption that would accompany the necessary shuttering of federal agencies once funding lapses, Congress has long relied on temporary spending bills known as continuing resolutions to provide interim budget authority. Fiscal 2025 was funded by three consecutive CRs, for example, while fiscal 2024 needed four. (Note that a government shutdown does not impact mandatory spending that falls outside the appropriations process, like Social Security payments and sovereign debt service.)

Not surprising given the polarized nature of today’s government, enacting a CR is proving no easier than the regular appropriations process. On September 19, the House of Representatives passed a Republican-backed continuing resolution through November 21—largely on party lines—though the bill was defeated in the Senate later that day. While Republicans are pushing a “clean” stopgap bill, Democrat lawmakers seek to tie any CR to a reversal of recent spending cuts to Medicaid and an extension of certain soon-to-expire subsidies under the Affordable Care Act.² Subsequently, the White House has instructed federal agencies not only to prepare for a shutdown, but also to “use this opportunity to consider Reduction in Force” notices to lay off federal employees.

Since bottoming at around $1,630/oz in October 2022, the gold price has rallied more than 120%.¹ Perhaps most remarkable about the current rally has been its persistence; the metal’s price plowed unceasingly higher through conditions both hospitable to gold appreciation and otherwise.

Global central banks, seeking to bolster their strategic gold reserves in response to heightened geopolitical risks and the specter of currency debasement, have been among the key sources of support for gold over the past few years. Annual net purchases of gold by central banks topped 1,000 tonnes in 2022–24 after averaging less than 500 tonnes annually between 2010 and 2021. Demand has remained firm in 2025 despite record prices, with authorities adding another 415 tonnes of gold in the first half of the year.²

A recent survey of central bankers suggested their appreciation of gold is likely to hold up, with 95% saying they expect central bank gold reserves to increase over the next 12 months and 76% believing that gold will represent greater share of total central bank reserves five years from now than it does today.³

More recently, financial buyers have also gotten into the game. Physically backed gold exchange-traded funds ETFs—which capture investment demand from both institutional and individual investors—have seen strong inflows in 2025 after four years of outflows. Year-to-date net demand stood at more than 470 tonnes through early September.⁴