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Mohamed El-Erian: The market will worry about debt-ceiling fight delaying tax reform

  • The U.S. markets have been well-behaved despite the political noise coming from Washington and geopolitical concerns, Allianz's Mohamed El-Erian said.
  • Looking ahead, he's not worried about a government shutdown or the debt ceiling because "that's going to be dealt with."
  • His main concern is that the fight over those things will delay tax reform and infrastructure spending.

The U.S. markets have been well-behaved despite the political noise coming from Washington and geopolitical concerns, but at some point that may change, noted economist Mohamed El-Erian told CNBC on Thursday.

And it is not necessarily because of a government shutdown or the debt ceiling, because "that's going to be dealt with," the chief economic advisor at Allianz said in an interview with "Closing Bell."

"My main concern is … all the noise around these two issues and the game of chicken that goes with these two issues are likely to delay further tax reform and infrastructure. And that's what the market is going to worry about at some stage," El-Erian said.

Republican leaders have said they want to have tax reform passed by the end of the year and on Thursday, House Speaker Paul Ryan insisted the party has enough time to make it happen.

In an interview with CNBC, Ryan said Congress will raise the debt ceiling and will likely pass a short-term funding measure before the Sept. 30 deadline. And he insisted that none of it will affect the work on tax reform

"Those of us who are leaders, we can multitask. We can work on funding, we can work on debt limit while the committee of jurisdiction works on getting this tax bill ready," he said.

— CNBC's Jacob Pramuk contributed to this report.

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