From the summary of a Goldman Sachs research note out this evening:
– The federal government has been partially shut down for 4 days, and it appears likely that the situation could continue for a while longer. As the shutdown continues, the political focus has begun to shift to the next deadline: the Treasury expects to exhaust its borrowing capacity by October 17. We expect the Treasury’s cash balance to be depleted no later than October 31 and possibly quite a bit sooner.
– After October 17, the Treasury can keep conducting auctions to roll over maturing securities, but it cannot increase outstanding debt. Under current sizes, October’s month-end settling auctions would raise a large amount of net cash. If the debt limit has not been raised, auction sizes could be cut significantly, or some of the month-end settling coupon auctions could be postponed.