If you're anything like me, you've been doing a lot of double-taking and head-shaking this year. It seems that almost everything has become more expensive, from grocery store visits and restaurant meals to oil changes. Even visiting my local Walmart, a retailer known for holding the line on prices, has left me disappointed at the register. Prices are undeniably higher, forcing many Americans to make difficult choices when it comes to spending, such as delaying discretionary purchases to free up more money ...

Core Insights - The U.S. Bureau of Labor Statistics (BLS) has canceled the release of the October consumer price index (CPI), impacting the Federal Reserve's ability to assess inflation data before its interest rate decision on December 10 [1][2] - The cancellation is due to the government shutdown, which hindered the BLS's ability to retroactively collect necessary survey data [2][3] - The release of November's CPI data has been rescheduled to December 18, after the Fed's decision [2] Data Collection Challenges - BLS data collectors utilize various methods, including personal visits and phone calls, which were not feasible during the shutdown [3] - Online data and household surveys also contributed to the difficulties in retroactively collecting information [3] Impact on Federal Reserve - The Commerce Department's Bureau of Economic Analysis has also indicated that the personal consumption expenditures (PCE) price index, another key inflation measure, will be rescheduled without a firm date [4] - Fed officials have expressed concerns about operating in a "data fog," complicating monetary policy formulation [5] - Fed Chair Jerome Powell emphasized the need for caution in decision-making during this period of uncertainty [6] - Despite the data challenges, some Fed officials believe there is still sufficient information to make informed decisions [7]

Core Viewpoint - The U.S. is facing a significant disruption in its inflation data reporting due to government shutdowns, leading to a lack of Consumer Price Index (CPI) data for the first time in over a century, which complicates economic planning and market operations [1][3]. Group 1: Impact on Economic Planning - The absence of timely inflation data hampers household budgeting, corporate planning, and investor decision-making, resulting in a market operating on unreliable information [4]. - Economists and traders are now forced to navigate without the CPI, which has historically been a critical measure of inflation, leading to improvisation in economic assessments [2][3]. Group 2: Market Disruption - The lack of CPI data has led to the emergence of two fallback systems for inflation measurement, which are inconsistent: the U.S. Treasury assumes inflation will continue at the previous year's average, while ISDA has frozen inflation at last October's level of 3.01% [5]. - This discrepancy has created a distorted market environment, with Barclays estimating a breakeven rate of 3.05% for TIPS compared to just 1.78% for inflation swaps, indicating a significant divergence that could disrupt traditional pricing models [6]. Group 3: Federal Reserve Actions - The Federal Reserve has begun cutting interest rates, bringing the target range to 4.00-4.25% as of September, amidst concerns over economic slowdown and employment stability [7]. - Despite the Fed's easing measures, inflation has shown signs of re-acceleration, complicating the economic landscape and posing risks to bond real yields and equity valuations [7].

Core Viewpoint - The U.S. government shutdown is impacting the release of inflation data, which may lead to a workaround by the Treasury for calculating the index that underpins the $2.1 trillion market for Treasury Inflation-Protected Securities (TIPS) for the first time since their inception in 1997 [1][2][6] Group 1: Impact of Government Shutdown - The Bureau of Labor Statistics has ceased all data collection and publishing during the shutdown, except for the September Consumer Price Index (CPI) [2] - The ongoing government standoff is now the second-longest on record, with the White House indicating that no inflation data will be published next month, affecting the scheduled release of the October CPI report [2] Group 2: TIPS Market Implications - The value of TIPS is directly linked to the CPI index, which determines the principal amount that adjusts with inflation [3] - Recent increases in TIPS yields, or "real yields," may reflect market uncertainty due to the absence of CPI data, as yields rise when bond prices fall [4][5] - A high risk premium in TIPS is noted, leading to cheaper trading conditions for these securities [5] Group 3: Treasury's Workaround Plan - The Treasury has a contingency plan to produce a fallback index based on the last available 12-month change in the CPI if the October CPI is not reported by the end of November [6] - This would mark the first time the fallback index is utilized since TIPS were launched [6] - Current yields on 10-year TIPS are around 1.7%, with five-year yields slightly higher at 1.249% [7]

Core Insights - The recent Consumer Price Index (CPI) data indicates a 0.3% increase in September, following a 0.4% rise in August, with a year-over-year increase of 3.0% compared to 2.9% in August, suggesting inflation remains manageable [3][10] - The Federal Reserve is expected to cut rates next week, with market expectations indicating at least two more cuts by March, as the current inflation data provides them with more flexibility [1][5][12] - The impact of tariffs on consumer goods prices is becoming more evident, particularly in categories like apparel, which may continue to rise through the end of the year [1][6] Economic Context - The CPI report was delayed due to a government shutdown but was released to assist in calculating cost-of-living adjustments for Social Security recipients [2] - Despite some underlying inflation pressures, the report's softness is attributed to noisy rent components, indicating that disinflation may not be significant moving forward [2][4] - The bond market reacted positively to the CPI data, suggesting that the market is supportive of potential rate cuts, which could enhance liquidity [4][5] Market Reactions - Initial market reactions to the CPI data were favorable, with a relief noted in futures markets, bonds, and commodities, indicating that investors are optimistic about the Fed's potential rate cuts [4][5][12] - The dollar experienced a temporary decline following the CPI report, but expectations of Fed rate cuts are likely to stabilize the dollar in the long run [8][9] - The market is currently pricing in an 88% probability of two additional rate cuts this year, reflecting strong investor sentiment towards the Fed's accommodative stance [12]

Get 100% ad-free experience CPI Preview: Inflation Data Looms Amid Shutdown With Fed Decision on the Horizon ByInvesting.com AuthorJesse Cohen Market Overview Published 10/24/2025, 04:22 AM CPI Preview: Inflation Data Looms Amid Shutdown With Fed Decision on the Horizon View all comments (0)0 Investing.com Articles(8015)|My Homepage Follow US500 0.58% As markets await the September Consumer Price Index (CPI) report, set for release Friday at 8:30 AM ET, investors and policymakers face a particularly complex ...

Core Insights - The crypto market is anticipating the release of September's Consumer Price Index (CPI), which is expected to show a 3.1% year-over-year increase, the highest in 18 months [1][2] - The expected inflation data may lead to larger price swings in ether compared to bitcoin, with ether projected to move by 2.9% and bitcoin by ±1.4% following the CPI release [1][6] Inflation Data Expectations - The CPI for September is forecasted to rise by 3.1% from the previous year, up from 2.9% in August, with a monthly increase of 0.4% [2] - Core inflation, excluding food and energy, is also expected to increase by 3.1% for the third consecutive month, with a monthly gain of 0.3% [3] Market Reactions - A higher-than-expected CPI could strengthen the dollar, potentially limiting gains in the crypto market, while a lower CPI might trigger a risk-on sentiment among investors [4][5] - Analysts suggest that the current market conditions, influenced by the U.S. government shutdown, have created a scenario where a lower CPI could boost bullish sentiment in the crypto space [5] Volatility Predictions - The options market indicates that ether is expected to experience greater volatility than bitcoin, with a projected ±2.9% move for ether compared to bitcoin's ±1.4% [6][7] - Volmex Finance's implied volatility indices for both Bitcoin and Ether suggest similar expected price fluctuations following the CPI release [7]

Core Insights - The upcoming release of September's consumer price index (CPI) report is expected to be a significant market event due to the lack of recent economic data caused by the government shutdown [2][3] - Economists predict a monthly increase of 0.4% in the all-items CPI, maintaining a 12-month inflation rate of 3.1%, which is 0.2 percentage points higher than August [4] - The focus will be on any deviations in inflation readings and the impact of tariffs on prices, with expectations of upward pressure in certain categories [5][7] Economic Context - The CPI report is the last major economic reading before the Federal Reserve's policy meeting, where another interest rate cut is anticipated [6][10] - Despite the uncertainty from the government shutdown, the economy has shown resilience, with GDP tracking close to 4% for the third quarter [11] - Geopolitical uncertainties, particularly regarding tariffs, are raising concerns about potential impacts on economic growth [9] Market Reactions - Investors are currently experiencing volatility, with major stock market averages nearing record levels [8] - A higher-than-expected CPI number could lead to increased market volatility, but it may also present buying opportunities given the strong economic fundamentals [12]

Core Points - The Labor Department is preparing for a potential halt in economic data releases due to a possible partial government shutdown, which could significantly impact economic insights ahead of the Federal Reserve's October meeting [1][10] - The Bureau of Labor Statistics (BLS) plans to suspend all operations, which includes halting the release of critical economic reports [2][4] - The upcoming release of the monthly nonfarm payrolls report and the Consumer Price Index (CPI) is particularly crucial, as they will provide key information on job growth and inflation before the Federal Reserve's policy meeting [5][7] Group 1 - The Labor Department's contingency plan indicates that economic data scheduled for release during a government shutdown will not be published, affecting various reports related to import/export prices and wages [4][10] - The BLS typically publishes around a dozen reports each month, and the shutdown would disrupt all active data collection activities for BLS surveys, potentially delaying future releases [4][10] - The government shutdown is set to occur if Congress does not approve a funding extension, with a deadline of 12:01 a.m. ET on Wednesday [8] Group 2 - The BLS's website will be inactive during the shutdown, meaning no updates or technical fixes will be available, further complicating access to economic data [11] - The revision of 911,000 jobs, the largest on record, has drawn criticism from the White House, which is calling for a Federal Reserve rate cut in response to the economic situation [2]

Economic Overview - Stagflation is characterized by weak or negative growth, high unemployment, and high inflation, with current conditions indicating a lowercase stagflation since the pandemic [1][2] - Economic growth is measured by GDP, which reflects domestic production, while GNP tracks earnings of Americans globally [2][3] Inflation Metrics - Key inflation indicators include the Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE), with the latter being favored by the Federal Reserve for its broader scope [3][4] - Distinction between headline inflation, which includes food and energy, and core inflation, which excludes these volatile components, is crucial for understanding inflation trends [4] Employment Indicators - The unemployment rate and monthly payroll changes are monitored closely, along with weekly unemployment claims, to gauge labor market health [5] - Historical data shows that during the 1970s stagflation, unemployment exceeded 7-8% with double-digit inflation and contracting GDP [6] Current Economic Conditions - Presently, unemployment is modest, PCE is in the high twos, and GDP remains strong, indicating that the economy is not in a severe stagflation scenario like the 1970s [7][8] - Precious metals have seen significant price increases, with gold up over 40% and silver nearing 60% this year, reflecting a response to elevated inflation and current interest rate cuts by the Federal Reserve [8] Monitoring Indicators - Key indicators to watch include jobs data, CPI, PCE, and GDP, with a focus on services inflation, shelter costs, and healthcare expenses [9] - Fluctuations in oil prices or a weaker dollar could quickly impact headline inflation, necessitating close monitoring of real incomes versus consumer demand [10] Conclusion - There is a potential risk of lowercase stagflation, but it is unlikely to escalate to the levels seen in the 1970s or 80s based on current observations [11]