Investors are bracing for the potential fallout from a US government shutdown, warning that a prolonged impasse could weigh on economic growth and complicate the Federal Reserve’s policy decisions.

While shutdowns have historically had limited impact on financial markets, this one comes at a delicate moment, with US equities trading near record highs and signs of economic slowdown emerging.

“We have the markets trading at extended valuations at all-time highs with an economy that seems to be showing some pretty clear signs of slowing,” said Eric Kuby, chief investment officer at North Star Investment Management.

“That slowness in the economy is going to be exacerbated by the lack of government spending, and the longer it goes on, the more difficult it is to overcome those challenges.”

The closure, which has led to the furlough of federal employees, also coincides with US President Donald Trump’s campaign to reduce the federal workforce, with about 300,000 jobs expected to be cut by December.

In past shutdowns, markets largely shrugged off the disruption. The S&P 500 has finished higher during every shutdown since 1995, according to Aptus Capital Advisors. But some analysts argue this time could be different, pointing to America’s credit rating downgrade earlier this year, ongoing trade tensions, and fiscal strain.

“It’s the cumulative, compounding effect of all of these events … that worries me,” said Brian Shipley, chief investment officer of Coldstream Wealth Management. Shipley said he has shifted some assets away from US Treasuries amid uncertainty.

Oxford Economics estimates the shutdown could shave 0.1 to 0.2 percentage points off US economic growth for every week it continues.