#247: What data will we get before December Fed meeting?
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Government shutdown is over. What did we get from it?
Where are markets pricing December FOMC?
What data will we get before December Fed meeting?
Government shutdown is over. What did we get from it?
The 43-day shutdown ended on 11/12 with Trump signing a funding bill that extends through 1/30/26, provides backpay for federal workers, and fully funds SNAP through Sept 2026. Democrats were not able to secure the ACA health insurance subsidy extension they fought for, instead accepting a promise from Senate Majority Leader John Thune to hold a vote by mid-December.
💸 Two-thirds of Americans expect health insurance premiums will increase in the coming months now that the shutdown ended without the subsidy extension
✈️ 670k federal employees were furloughed and the FAA reduced flights by 6% due to air traffic controller staffing
🔄 We’re funding the government for just 75 days before potentially doing this all over again in late January
Where are markets pricing December FOMC?
Markets shifted from over 90% to just 49.4% probability for a December rate cut as Powell explicitly warned it’s “not a foregone conclusion.”
The October FOMC meeting saw a deeply divided committee vote 10-2, with Stephen Miran dissenting for a bigger 50bp cut while Jeffrey Schmid wanted no cut at all.
What’s driving the doubt:
📊 Inflation remains stuck at 3% – well above the Fed’s 2% target
🔀 Powell said the committee has “strongly differing views about how to proceed in December” and noted “there are no risk-free paths now”
What data will we get before December Fed meeting?
This is where things get ugly. The Fed might be making its December 9-10 decision essentially blind (in the worst case scenario).
Jobs Reports: National Economic Council Director Kevin Hassett confirmed we’ll get October payroll numbers but no October unemployment rate. The September jobs report will be released on 11/20.
IMO: We’ll likely get the October payroll data before the December 10th FOMC meeting, but it’ll be missing the unemployment rate – a critical piece of the labor market puzzle.
Inflation Data: White House Press Secretary Karoline Leavitt said the October CPI report is “likely never being released” because the BLS went dark during the shutdown. We might get lucky and see November CPI data before the December FOMC date, but even that’s uncertain given the delayed restart of data collection.
The Bottom Line: Powell’s own words at the October meeting sum it up: “what do you do if you’re driving in the fog? You slow down” – a clear signal that missing data could force a pause. Two-thirds of the pricing data that feeds into CPI is collected by in-person visits to brick-and-mortar stores, making retroactive collection nearly impossible.
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