Data Fog Intensifying for Fed as Shutdown Delays US Inflation Numbers

Core Insights - The Federal Reserve's decision on a potential rate cut in December is uncertain due to the lack of official inflation and job market data resulting from the government shutdown [1][4][5] Economic Data Impact - The Bureau of Labor Statistics (BLS) has delayed the release of the October Consumer Price Index (CPI) report, which could impact the Fed's decision-making process [5][6] - The September CPI showed a lower-than-expected increase of 3% year-over-year, and alternative measures suggest a similar trend for October [2][3] Federal Reserve's Position - Fed officials are facing challenges in assessing economic conditions due to the absence of official reports, which complicates the debate on whether another rate cut is necessary [4][6] - New York Fed President John Williams indicated that the next rate decision is a balancing act, acknowledging high inflation while noting the economy's resilience [7] Global Economic Context - Other central banks, such as the Bank of Canada and the Reserve Bank of India, are also closely monitoring inflation data to inform their monetary policy decisions [7][9][10] - In Asia, China's consumer prices unexpectedly rose in October, while India's inflation is expected to slow, influencing the Reserve Bank of India's policy outlook [9][10] Regional Developments - In Europe, the Bank of England is preparing for a potential rate cut in December, with upcoming labor statistics and GDP data expected to provide further insights [13][14] - The eurozone is experiencing a quieter data week, with key indicators like Germany's ZEW investor confidence and industrial production being monitored [15]