US Government Shutdown Highlights: A deadlock over healthcare and government spending has prompted the US to go for a government shutdown in a first in nearly seven years.
Democrats and Republicans in Congress remain at an impasse, risking the furlough or possible permanent layoff of thousands of federal employees.
The US government began to shut down at 12:01 am on Wednesday as the Senate failed to approve a measure passed by the House that would temporarily extend federal funding for seven weeks, giving lawmakers no more chance to finalise the annual budget legislation.
Senate Democrats have stated they will not support the bill unless Republicans agree to include an extension of expiring health care benefits, along with other demands. Meanwhile, President Donald Trump and Republicans are refusing to engage in negotiations, insisting it is a stripped down, "clean" bill that should be noncontroversial.
Trump showed little willingness to consider Democrats' demands on health care, despite agreeing to attend a meeting on Monday with Schumer, Senate Majority Leader John Thune, R-S.D., House Speaker Mike Johnson, R-La., and House Democratic leader Hakeem Jeffries, D-N.Y.
Before entering the meeting, Trump made it clear he had no plans to negotiate under the Democrats' current terms. He stated, “Their ideas are not very good ones."
Stay tuned to LiveMint for live updates on potential Government Shutdown in US
Government shutdown 2025 LIVE updates: The dollar sank to a one-week low against major currencies amid the US government shutdown that unsettled markets and threatened to delay key jobs data
According to the rules, essential workers will have to show up to work even during a government shutdown. However, it is unlikely that they will receive pay till the government opens up, after which they will be back-paid.
There is an exception to this rule. Members of Congress, whose pay is protected under the US Constitution, will receive their salaries.
It is unclear how long a shutdown could last.
Economists have warned that pressure would mount to reopen the government if a stoppage lasted for two weeks -- threatening missed paychecks because this is a typical US pay cycle.
The closure of the federal government will curtail or halt some US climate disaster preparedness and environmental programs — and even potentially delay real estate transactions within the nation's flood zones.
The dollar sank to a one-week low versus major peers on Wednesday as the U.S. government entered a shutdown that is likely to delay the release of crucial jobs data. The dollar index, which gauges the currency against six counterparts including the euro and yen, declined 0.2% to 97.635 as of 0521 GMT, and earlier dipped to 97.584 for the first time since last Wednesday.
DHS will furlough nearly 23,000 employees. All active-duty troops keep working, though pay could be delayed. The US Transportation Department said on Tuesday more than 11,000 employees at the Federal Aviation Administration, about a quarter of its staff, would be furloughed if government funding lapses.
The last time the US government had shut down was nearly 7 years ago, when Donald Trump was President.
Now that a lapse in funding has occurred, the law requires agencies to furlough their “non-excepted” employees. Excepted employees, which include those who work to protect life and property, stay on the job but don't get paid until after the shutdown ends.
“President Trump and Congressional Republicans just shut down the government because they refused to stop your health care costs from rising. Let me be clear: Republicans are in charge of the White House, House, and Senate. This is their shutdown,” says former US vice president Kamala Harris.
The official X page of the White House posted a graphic confirming the “Democrat Shutdown”
The shutdown commenced hours after the Senate rejected a short-term spending measure that would have kept government operations afloat through November 21.
There was no clear path out of the impasse, while agencies warned that the 15th government shutdown since 1981 would halt the release of a closely watched September employment report, slow air travel, suspend scientific research, withhold pay from U.S. troops and lead to the furlough of 750,000 federal workers at a daily cost of $400 million.
Congress blew past a midnight funding deadline, triggering the US government’s first shutdown in nearly seven years — and the third under President Donald Trump.
US government shutdown takes effect as lawmakers fail to reach consensus and deadline expires.
Democrats are demanding the renewal of expiring subsidies for Obamacare health insurance premiums in return for their votes for a temporary funding patch and provisions to stop Trump from unilaterally withholding congressionally approved spending. They also want to reverse Medicaid cuts included in Trump’s signature tax legislation passed earlier this year.
Essential workers like military troops will work without pay while non-essential federal employees are set to be furloughed.
As many as 750,000 federal workers could be temporarily furloughed, even if Trump doesn’t proceed with permanent dismissals, the nonpartisan Congressional Budget Office estimated.
The US Transportation Department said on Tuesday more than 11,000 employees at the Federal Aviation Administration, about a quarter of its staff, would be furloughed if government funding lapses.
Gold hit a record high on Wednesday as investors turned to safe-haven assets on growing risks of a U.S. government shutdown, while weak labour data strengthened expectations of further interest rate cuts by the Federal Reserve.
Spot gold rose 0.4% to $3,872.87 per ounce by 0206 GMT. U.S. gold futures for December delivery gained 0.7% to $3,901.40.
The Trump administration has withdrawn its nomination of conservative economist EJ Antoni as head of the Bureau of Labor Statistics, the White House said on Tuesday.
President Donald Trump nominated Antoni last month to lead the bureau, which is part of the Department of Labor and produces statistics closely watched by the markets, after firing the agency's head, Erika McEntarfer, and accusing her without evidence of manipulating the bureau's figures.
“Dr. EJ Antoni is a brilliant economist and an American patriot that will continue to do good work on behalf of our great country," a White House official said in a statement, promising the president will announce a new nominee "very soon."
Gold prices are nearing towards an all-time high amid the US government shutdown that has bolstered demand. Spot gold was up 0.2% at $3,861.22 per ounce, as of 0030 GMT.
A last-minute resolution seems to be a distant dream as Democrats and Republicans have shown no intention of bridging their divides. Any agreement between the parties would also have to be approved by the House of Representatives led by Republicans, which is not in session at the present.
Senate Democrats have voted down a Republican bill to keep funding the government, putting it on a near certain path to a shutdown after midnight Wednesday for the first time in almost seven years.
After the vote, the White House's Office of Management and Budget issued a memo saying that “affected agencies should now execute their plans for an orderly shutdown.”
Government shutdown 2025 LIVE updates: The United States is likely to witness a potential federal government shutdown from 1 October 2025.
The partisan standoff over health care and spending is threatening to trigger the first U.S. government shutdown in nearly seven years, likely starting on Wednesday, 1 October 2025.
Government shutdown 2025 LIVE updates: The US Transportation Department on Tuesday, 30 September 2025, announced its plans to insulate air traffic control services and new employee training from a potential government shutdown, reported the news agency Bloomberg.
According to the agency report, the department plans to keep the vital aviation functions running amid threats of a potential US federal government shutdown.
Government shutdown 2025 LIVE updates: The benchmark indices on Wall Street managed to close with modest gains after Tuesday's trading session, as fears and caution over a potential shutdown of the US federal government loomed over market investors.
According to a Reuters report, the S&P 500 gained 0.40% to end at 6,687.82 points, while the Nasdaq Composite gained 0.29% to end at 22,655.74 points. The Dow Jones Industrial Average rose 0.19% to close at 46,405.81 points, as per the preliminary data.
Government shutdown 2025 LIVE updates: The Federal Aviation Administration (FAA) is likely to furlough 11,000 employees amid the US government shutdown, which is likely to start after Trump's deadline of 12:01 a.m. on 1 October 2025, reported the news agency Reuters, citing the U.S. Transportation Department.
Government shutdown 2025 LIVE updates: The Department of Homeland Security also stated that financial operations funded by U.S. Citizenship and Immigration Services fees would continue in the event of a potential U.S. government shutdown, along with services and operations necessary to support the agency's exempt activities, reported Reuters on Tuesday.
Government shutdown 2025 LIVE updates: Markets around the world are turning over into a bearish note as the cautionary sentiment over a US government ‘shutdown’ looms over investors.
The Bloomberg US Dollar Spot Index was down 0.19% trading at 97.724 as of 1:53 p.m. (EDT) on Tuesday, 30 September 2025.
The S&P 500 dipped 0.15%, the Dow Jones Industrial Average lost 0.30%, and the Nasdaq Composite lost 0.30% during the Wall Street session, according to MarketWatch data.
Government shutdown 2025 LIVE updates: The US Department of Homeland Security announced on Tuesday, 30 September 2025, that customs & border protection revenue collections will continue in the event of a potential US government shutdown, reported the news agency Reuters.
Trump said Democrats were "taking a risk" in their shutdown negotiations and mentioned that the Trump administration has the ability to reduce the benefits it provides, Reuters reported.
As per AFP, on potential government shutdown, Trump informed reporters at Oval office that “nothing is inevitable but I would say it's probably likely”.
United States President Donald Trump on September 30 said the US will “probably have a shutdown”, which will be 15th since 1981, Reuters reported
Government shutdown 2025 LIVE Updates: Speaking on government spending, Trump said, “we can do things in a shutdown that are irreversible," reported Reuters.
Government shutdown 2025 LIVE Updates: When employees are placed in a temporary status where they do not work and do not get paid, it is known as shutdown furlough.
Government shutdown 2025 LIVE Updates: Federal law mandates that agencies stop operations and place “non-excepted” employees on furlough when funding lapses. Those considered excepted, typically workers involved in protecting life and property, must continue working without pay until the shutdown is over.
In the 35-day partial government shutdown during Trump’s first term, out of 800,000 federal employees affected, 340,000 were furloughed while the rest, classified as “excepted", were required to keep working, reported AP.
US stock markets dipped and gold pulled back from its record high on Tuesday, as traders braced for a potential government shutdown, according to AFP.
Social Security and Medicare benefits would remain unaffected, as these programmes are funded through permanent laws passed by Congress that don't require yearly approval.
However, the National Park Service (NPS) would likely face disruptions. In the 2013 government shutdown, the NPS closed access to hundreds of parks, monuments, and other sites, turning away millions of visitors. In contrast, during the 2018–2019 shutdown, the Trump administration chose to keep parks open to the public, even though many employees were not on duty.
This approach led to damage within the parks, according to the National Parks Conservation Association. The organisation has advocated for closures in the event of a shutdown, warning that without proper staffing, NPS sites would be left vulnerable.
The American Federation of Government Employees (AFGE) stated that the necessity to prevent a shutdown has “reached a new level of urgency”, AFP reported. AFGE President Everett Kelley called on lawmakers to engage in discussions, emphasising that “federal employees are not bargaining chips”.
The last shutdown occurred during Trump’s first term, spanning from December 2018 to January 2019, when he insisted that Congress fund his U.S.-Mexico border wall. After 35 days, marking the longest shutdown in history. Trump backed down as airport delays worsened and federal employees went without pay.
As per a report by Bloomberg, in response to a question about how many government employees might be dismissed during a shutdown, Trump said, “We may do a lot and that’s only because of the Democrats.” Last week, the White House instructed federal agencies to prepare plans for mass firings in the event of a government shutdown. However, no agencies have specifically included terminations in their current shutdown plans.
Democrats are advocating for the renewal of Affordable Care Act tax credits that have helped millions afford health insurance since the COVID-19 pandemic. These credits, aimed at increasing coverage for low- and middle-income individuals, are scheduled to expire at the end of the year. “Democrats are fighting to protect the health care of the American people,” Jeffries, a New York Democrat said, according to AP, adding, “We are not going to support a partisan Republican spending bill that continues to gut the health care of everyday Americans.”
Vice President JD Vance informed reporters after the meeting, “I think we’re headed into a shutdown because the Democrats won’t do the right thing.”
As per report by Bloomberg, after the meeting, Senate Democratic leader Chuck Schumer stated, “If he will accept some of the things we asked, which we think the American people are for, on health care and on rescissions, he can avoid a shutdown, but there are still large differences between us.”
Trump met with senior Democratic and Republican congressional leaders at the White House in a final attempt to avoid a government shutdown before the Oct. 1 deadline. However, the meeting ended without progress on key Democratic demands to extend health-care subsidies and roll back Medicaid cuts included in Trump’s major tax legislation passed earlier this year.
