The United States Congress returns from its summer recess on September 5th. When voting members arrive back, topics such as President Donald Trump’s promises to cut taxes and boost infrastructure spending might be temporarily overshadowed by a more prominent near-term risk for the markets.

In 2015, Congress suspended the debt ceiling via the passing of the Bipartisan Budget Act until March 2017. Since then, the US Treasury has been resorting to extraordinary measures in order to make payments while avoiding going over the current debt limit of $19.8 trillion. If legislators do not come to an agreement to raise it by September 29th, the estimated limit of the extraordinary measures, the US might have to go into a technical default.

Conveniently, this is not the first time that the markets will be exposed to a threat like this, unlike the unknown implications of Brexit or the 2015 threat of Greece’s exit from the European Union. This means that we can look back to close calls in the past, such as in 2011 and 2013, to get an idea of what might be expected in the financial markets.

In 2011, Republicans in Congress demanded a deficit reduction as part of raising the debt ceiling. The issue was resolved on August 2nd via the Budget Control Act. However, three days later ratings giant Standard & Poor’s issued its first ever sovereign credit downgrade in the federal government’s AAA (“outstanding”) rating, bringing it down to AA+ (“excellent”). This threatened US government bonds’ status as the world’s most attractive safe haven for investors to park their capital in times of economic crises.

Leading into the downgrade and as tensions were high in the legislative branch, the Dow Jones Industrial Average and S&P 500 swiftly fell to their lowest levels of the year. Then, the indexes had one of their worst days as the S&P downgrade undermined the US Dollar’s reserve-currency credentials. The anti-risk Japanese Yen appreciated while the sentiment-linked Australian and New Zealand Dollars faltered. In addition, gold prices gained ground as bond yields fell amid risk aversion, boosting the appeal of anti-fiat assets.