Markets are increasingly bracing for a government shutdown after President Donald Trump canceled a scheduled White House meeting with Democratic leaders earlier today, sending Kalshi shutdown contracts to their highest levels of the year.
The contract on whether the government shuts down on October 1 now sits at 71%, up more than five points on Tuesday and nearly 15 points from a week ago. Broader markets that ask if a shutdown will occur at any point this year also climbed to 71%, their all-time high, after surging more than 35 points this month.
At the same time, Kalshi traders slashed expectations that Trump will meet with Senate Majority Leader Chuck Schumer or House Minority Leader Hakeem Jeffries before the deadline. That contract collapsed to just 20%, a 21-point drop on the day.
After scrapping the planned Thursday meeting with Schumer and Jeffries, Trump blasted what he called “unserious and ridiculous demands” from Democrats. On his Truth Social platform, Trump accused them of pushing for “over $1 trillion” in new spending tied to health care and social programs. CNN first reported the cancellation and noted that Trump left the door open to meeting later if Democrats “become realistic about the things our Country stands for.”
Jeffries shot back online, writing “Trump Always Chickens Out,” while Schumer accused the president of “running away from the negotiating table before he even gets there,” CNN reported.
That bitterness has been simmering for months. As The Hill reported, Trump and Schumer’s relationship is now so toxic that lawmakers in both parties doubt they can strike any agreement. The two last attempted serious negotiations in August, but Trump abruptly ended the talks with a blunt “Go to hell” post. The Hill notes that Trump is in no mood to make concessions, especially after the assassination of conservative activist Charlie Kirk.
Shutdown duration?
Markets are now forecasting not just a shutdown, but one that lasts multiple days. A series of duration contracts shows the risk profile shifting:
71% chance of any shutdown (more than 0 days)
56% chance it lasts more than 3 days
44% for more than 5 days
33% for more than 10 days
17% for more than 35 days
The median forecast across Kalshi’s markets now points to a shutdown of 4.5 days, up from around three days earlier this month.
Why it matters
The deadline is fast approaching: funding expires at midnight on September 30. A partial government closure would immediately halt “nonessential” federal operations and furlough thousands of workers, with ripple effects across the economy.
Kalshi markets suggest the shutdown is no longer just a bargaining tactic but the baseline scenario, with the odds of talks materializing dwindling as the Trump–Schumer feud drags on.
The takeaway: Kalshi markets now forecast
For now, traders are signaling that Washington’s political stalemate is set to become an economic reality.
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