US: Growth seen slowing as shutdown drags – Deutsche Bank

💡 DMK Insight

Deutsche Bank’s GDP forecast cut signals potential market turbulence ahead. A slowdown from 4.4% to 2.5% in Q4 2025 is significant, especially as it stems from a prolonged government shutdown. This could lead to reduced consumer spending and business investment, impacting sectors like retail and manufacturing. Traders should keep an eye on related economic indicators, such as unemployment rates and consumer confidence, which may react to this news. If GDP growth slows as projected, we might see a shift in monetary policy expectations, affecting forex pairs like USD/EUR and commodities tied to economic performance. But here’s the flip side: if the shutdown ends sooner than expected, we could see a rapid rebound. So, watch for any developments in Congress that could change the trajectory of this forecast. Key levels to monitor include the S&P 500 support around recent lows, which could signal broader market sentiment shifts if breached.