Government Shutdown Disrupts Key Economic Data Releases, Fed Faces Uncertainty

The U.S. government shutdown has caused severe disruptions to the release of critical economic data, with October's employment and consumer price index (CPI) reports potentially becoming permanently unavailable. White House Press Secretary Karoline Leavitt confirmed on November 12 that these reports "likely never being released" due to the shutdown, which has paralyzed federal statistical agencies since October 1 . The Bureau of Labor Statistics (BLS) and Commerce Department’s Census Bureau have suspended data collection, processing, and publication, leaving policymakers with significant gaps in economic visibility .

The absence of October data creates a "data fog" for the Federal Reserve, which relies on timely metrics to guide monetary policy. Leavitt warned that this situation is "leaving our policymakers at the Fed flying blind at a critical period" . The central bank’s December 9-10 meeting, where interest rate decisions will be made, now faces uncertainty after the October 28-29 meeting cut rates by 25 basis points to 3.75%-4.00% . Fed Chair Jerome Powell previously emphasized that further rate cuts in December were not "a foregone conclusion" amid the data blackout .

Economists have proposed solutions to mitigate the impact. Boston College’s Brian Bethune argued that the Labor Department should prioritize releasing November data first when operations resume, even if it means delaying or omitting October reports. "Ideally, you don’t want the data to be released chronologically... you don’t want to have November data in January," he stated, highlighting the need for up-to-date information for the December policy meeting . This approach aligns with the Fed’s requirement for real-time economic signals to assess inflation and labor market conditions.

The shutdown has already created a backlog in data releases. While the September CPI report was published during the shutdown, the same cannot be said for October’s data. Leavitt claimed the Democratic Party may have "permanently damaged the federal statistical system" by allowing the October reports to lapse . The BLS conducts portions of its data collection physically, such as household surveys for unemployment, which were interrupted in October . Analysts caution that some reports may be skipped entirely if data collection cannot be retroactively completed .

The economic uncertainty extends beyond the U.S. borders. Global markets rely on American economic data to assess the health of the world’s largest economy. The delayed or missing October reports complicate international investors’ ability to model growth trends and inflation risks. Private institutions have attempted to fill the void with alternative metrics, but these lack the methodological rigor of official government statistics .

Statistical agencies have indicated they will update release schedules once normal operations resume. However, the path to resuming data publication remains unclear. The House of Representatives was scheduled to vote on a stopgap funding package on November 12 to end the shutdown, but no resolution has been announced . Without immediate action, the economic data landscape will remain fragmented, forcing policymakers and markets to operate with incomplete information.