Government Shutdown Disrupts Key Data Releases, Clouds Fed Policy Path

The U.S. government shutdown has triggered a critical data blackout, with October employment and inflation reports unlikely to be published, according to White House Press Secretary Karoline Leavitt . This disruption has created significant uncertainty for policymakers, particularly as the Federal Reserve (Fed) prepares for its December meeting. Leavitt warned that the absence of October data "leaves our policymakers at the Fed flying blind at a critical period" , underscoring the systemic risk posed by the shutdown.

The Bureau of Labor Statistics and other statistical agencies have suspended operations since October 1, halting data collection and publication . While the September Consumer Price Index (CPI) report was released before the shutdown began, gaps remain in understanding the economic trajectory. Economists note that physical data collection for October reports—such as household surveys for employment data—was also disrupted, raising doubts about the feasibility of reconstructing these reports .

The Federal Reserve faces a data void at a pivotal moment. Fed Chair Jerome Powell previously indicated that a rate cut at the December 9-10 meeting was not "a foregone conclusion," citing the "data fog" caused by the shutdown . The central bank cut its benchmark rate by 25 basis points in October, but the lack of recent data complicates assessments of whether further easing is warranted. Boston Fed President Lorie Logan Collins emphasized that "absent evidence of a notable labor market deterioration, I would be hesitant to ease policy further, especially given the limited information on inflation due to the government shutdown" .

Efforts to mitigate the data gap are underway. The U.S. Labor Department’s statistical agency has been urged to prioritize the release of November employment and inflation reports once operations resume, ensuring the Fed has up-to-date information for its December decision . Economists like Brian Bethune of Boston College argue that "from a monetary policy perspective, you want the November data first," even if it means delaying chronological backfilling of October reports . This approach would provide a clearer picture of current economic conditions, though it leaves the October data permanently incomplete.

The shutdown has also exposed vulnerabilities in the U.S. statistical system. Leavitt claimed the Democratic Party "may have permanently damaged the federal statistical system" by allowing October reports to be lost . The Labor Department’s Bureau of Labor Statistics and the Commerce Department’s Census Bureau both rely on continuous data collection cycles, which the 30-day shutdown has irreparably disrupted. Private institutions have attempted to fill the void with alternative metrics, but these lack the authority and granularity of official reports .

Market participants are closely monitoring the situation. The October FOMC meeting saw a 10-2 vote in favor of the rate cut, with dissenters including Kansas City Fed President Jeffrey Schmid and Governor Stephen Miran . Schmid opposed the cut entirely, while Miran argued for a larger reduction. The lack of October data may amplify existing divisions among policymakers, as the Fed navigates the balance between inflation control and labor market support.

The broader implications extend beyond monetary policy. The shutdown has disrupted data flows critical to economic forecasting, business planning, and fiscal policymaking. The House of Representatives was set to vote on a stopgap funding package to end the shutdown, but the delay in data releases highlights the fragility of the U.S. statistical infrastructure .

1. October Jobs, CPI Data Unlikely to Be Released, White House Says 

2. US Labor Department Urged to Prioritize November Employment, CPI Data Post-Shutdown 

3. Boston Fed President Collins Advocates Holding Rates Steady, Sees 'High Bar' for Further Cuts