Powell Warns of Data Fog as Shutdown Skews Federal Reports

Hadisur Rahman, JadeTimes Staff

H. Rahman is a Jadetimes news reporter covering Business

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Image Source: Al Drago/Bloomberg via Getty Images

With the government shutdown clouding key inflation and labor indicators, economists and policymakers are bracing for a period of limited visibility as data releases lag or disappear entirely. The White House on Wednesday signaled that October CPI and employment figures may never see the light of day, raising concerns about how the Federal Reserve will calibrate policy amid uncertain economic signals.

White House press secretary Karoline Leavitt described the potential data gaps as a lasting setback to the federal statistical system, suggesting that crucial measures of inflation and employment could be permanently impaired if open reporting cannot be restored. In subsequent clarification, officials noted that September’s jobs report, collected before the shutdown, would be released once normal operations resume; however, October’s jobs data remained in jeopardy.

The absence of timely government data has created a “fog” around the state of the labor market and price pressures. The last full set of figures came from the August jobs report, released on Sept. 5, and economists have since relied on private-sector indicators and alternative data to infer trends. The Bureau of Labor Statistics and the Department of Labor did not immediately respond to requests for comment on Leavitt’s remarks.

Markets and policymakers are accustomed to a steady stream of government data to anchor decisions. Without it, both the Fed and financial institutions may lean on private datasets, such as the ADP private payrolls report, which showed a modest gain in October, while acknowledging that these figures are not a substitute for official government releases.

Fed Chair Jerome Powell acknowledged the disruption, describing the situation as a “temporary state of affairs” and likening it to navigating in fog: “If you ask me, ‘Could it affect the December meeting?’ I’m not saying it’s going to, but … what do you do if you’re driving in the fog? You slow down.” As the shutdown endgame unfolds, analysts will watch for signs that data gaps don’t derail the Fed’s gradual approach to inflation and employment stabilization.