On Wednesday, Trump’s chief economist, Kevin Hassett, warned that if the partial shutdown lasts until the end of Mach, and entire quarter of GDP could be wiped out, according to The Hill.
On the 33rd day of the shutdown, Hassett told CNN, “It is true that if we get a typically weak first quarter and then have an extended shutdown that we could end up with a number that’s very, very low.”
He added that it was possible that the U.S. could see no growth at all in the first quarter if the shutdown lasted until the end of March.
The White House Council of Economic Advisors projected 1.7 percent annualized GDP growth for the first quarter. Each week the shutdown continues could bring the percentage points down 0.1. By the end of March, the GDP growth could fall 1.2 percentage points.
Hassett adds that the government shutdown combined with the usual economic slowness from January to March could stop growth in the quarter, but the economy would bounce back quickly.
Hasset said, “Then again, the second-quarter number would be humongous if the government reopened.” He added that it could rise as high as 4 or 5 percent.
The White House hopes to play down the shutdown’s long-term consequences by promising an immediately rebounded economy once a deal is agreed upon.
Hassett also refuted concerns of a credit downgrade for the U.S. as a consequence of the shutdown.
“I don’t think a downgrade is in play. I don’t think that there’s any risk at all, given how strong the economy is, that we will be downgraded,” says Hassett.
On the other hand, the "credit rating firm Fitch has said it could lower the country’s credit rating if the shutdown prevents lawmakers from reaching a timely deal to raise the federal debt limit."