The 2023 debt ceiling crisis disrupted some markets but left limited economic impact

The near shutdown of the US government in September and the debt ceiling crisis in the first half of 2023 have forced Americans to become more accustomed to government dysfunction. The uncertainty resulting from such crises temporarily increases government borrowing costs even if default does not occur. But other key indicators of financial health including VIX, a measure of volatility in the market, have not been discernibly affected in recent debt ceiling scares, with the exception of 2011, when disruption was more widespread.
Shortly after the default confrontation in June, which was…