Data Fog Intensifying for Fed as Shutdown Delays US Inflation Numbers

What we drew from this source

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• Borrowing costs are at 'about the right level' as long as the economy and inflation evolve as expected.

  80% confidence

• Alternative measures like the Cleveland Fed's 'nowcast' CPI suggest a similar outcome for October as September's 3% year-over-year increase.

  80% confidence

• Even if the government were to reopen, it's unlikely the Bureau of Labor Statistics would be able to collect and process data for both the October and November CPI reports ahead of the December FOMC meeting. October's figures would have greenlit a rate cut at the final meeting of the year.

  80% confidence

• The bank hasn't yet arrived at the terminal rate of its easing cycle and is in a data-dependent mode.

  80% confidence

• It's increasingly likely the BLS will forgo issuing an October CPI report altogether due to government shutdown halting in-person data collection.

  80% confidence

• A December rate cut wasn't assured following the Fed's rate reduction in October.

  80% confidence

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