Warning Issued Over U.S. Debt Ceiling

Goldman Sachs' boss Lloyd Blankfein has warned that the US debt ceiling needs to be increased if an "extremely adverse" reaction is to be avoided.

The US government has gone into shutdown mode after Congress was unable to agree a new budget deal after a row over Obamacare.

US president Barack Obama met with banking leaders from across Wall Street this week before a television interview in which he admitted to being "exasperated" with Republicans who have blocked his plans for the economy.

Mr Blankfein stated that the country's business leaders want Washington to understand "the long-term consequences of a shutdown".

The shutdown started on Tuesday (October 1st) and analysts have warned global markets will be affected unless it is brought to an end in the next few days.

Some have claimed that the government shutdown is costing the US economy $300 million (£185 million) per day, affecting the country's economic recovery.

The price of gold has so far been unaffected by the US government shutdown, as investors are not yet flocking to the safe haven precious metal.

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