We’re not the only ones flying a little bit blind these days, thanks to the government shutdown, which shows no signs of restoring federal services and paychecks nationwide.

Interest rates for home equity, auto and student loans are also on this impaired radar screen. 

As are Federal Reserve policymakers, who face a critical data gap because the shutdown shelved most of the leading economic indicators for September used to help set monetary policy.

Related: Social Security’s 2026 COLA increase hinges on key data

But there is one key piece of data breaking through the shutdown in time for the Oct. 29-30  Federal Open Market Committee (FOMC) meeting.

The delayed release of September’s Consumer Price Index (CPI), now scheduled for Oct. 24, will be indispensable for Fed officials mulling whether to cut the benchmark Federal Funds Rate to lessen the cost of short-term borrowing.

  • Will inflation continue to be “sticky?”
  • Are tariffs continuing to put pressure on the cost of goods like furniture?
Borrowers eagerly await the Federal Reserve decision on interest rates on Oct. 29.

Oliver Contreras/for The Washington Post via Getty Images

How the Fed balances inflation, jobs and interest rates

With the government’s primary statistical agencies shuttered, private sector data fills some gaps but often lacks credibility or timeliness, leaving the Fed and investors in a “data fog” that complicates monetary policy and market reactions.​

These missing data points are essential for the Fed’s dual mandate: maximum employment and stable prices.

Related: Bank of America resets inflation forecast ahead of CPI

Without fresh data, the Fed risks misjudging the economy’s trajectory.

  • These goals require a delicate balance of monetary policy because higher interest rates lower inflation but increase job losses.
  • Lower interest rates decrease unemployment but increase inflation.
  • The Fed uses interest rates as the tool to comply with its mandate.

Meanwhile, political pressure mounts

Complicating matters further is the escalating, often nasty, tension between the White House and the Fed. 

President Donald Trump has: 

  • Repeatedly criticized the independent central bank’s rate decisions 
  • Demanded cuts as deep as three percentage points to boost the lagging U.S. housing market and reduce interest payments on the national debt.
  • Reportedly pushed for more aggressive cuts to stimulate growth ahead of the 2026 election cycle.

Fed Chair Powell on the “missing” data impact on the FOMC 

Federal Reserve Chair Jerome Powell has warned that without the Labor Department’s statistics, the central bank is “flying blind.”

As a result, Powell said the FOMC must depend on private sector alternative measures like the ADP payroll report and industry anecdotes, which lack the granularity of federal data. 

We’ll start to miss that data and particularly the October data. If this goes on for a while, they won’t be collecting it. And it could become more challenging.

Federal Reserve Chairman Jerome Powell

Forecasts for the September CPI report 

Early forecasts indicate inflation likely continued to run hot during September as the highest tariffs in nearly 100 years pushed the prices of goods higher. 

The CPI rose faster during the summer, hitting its largest increase thus far in 2025 in August, coming in higher than economists expected. 

Core CPI, which excludes more volatile food and energy prices, also hit its highest level this year in July and August.

What economists are saying about inflation

“Inflation is certainly temporarily running hot,” Jeffrey Roach, chief economist at LPL Financial, told Morningstar. “But the operative word is ‘temporarily.’’ 

  • Overall, economists foresee that inflation rose by 0.4% month over month in September and by 3.1% from year-ago levels. 
  • Core inflation will likely have risen 0.3% by month and 3.1% annually in September, according to data from FactSet. 
  • Figures consistent with these forecasts would be about the same as they were in August.

October FOMC meeting interest rate outlook 

Nearly all major forecasters, including Reuters, Comerica Bank, and RSM, expect the Fed to lower the funds rate by 25 basis points, from the current 4.00–4.25% range to 3.75–4.00% at its October meeting.

Futures markets tracked by the CME FedWatch tool are pricing in a 99% probability of such a cut. 

The move would continue the easing cycle that began in September, when the Fed cut rates for the first time since December 2024 amid weakening job growth and tariff-driven inflation pressures.​

Likelihood of a second (December) cut

Most economists, around 70% to 75% of them, expect the Fed to follow up with another quarter-point cut in December, bringing the end-of-year target range to 3.50–3.75%. 

The reasoning is twofold: concerns about a softening labor market and the desire to avoid recession while acknowledging that inflation remains sticky near 3%.​

However, the government shutdown has delayed key employment and inflation data releases, creating uncertainty that could influence the December decision.

Key economic reports missing due to shutdown

Many leading economic indicators that typically inform FOMC deliberations are absent or delayed:

  • Jobs Report (Nonfarm Payrolls & Unemployment): The September employment report was completed prior to the shutdown but remains unpublished; October data collection is paused, creating a vacuum in labor market analysis.​
  • Producer Price Index (PPI): Delayed, leaving questions about upstream price pressures.​
  • Retail Sales Figures: Not updated, impacting insight into consumer spending.​
  • Durable Goods Orders: Paused, reducing visibility into business investment trends.​
  • International Trade and Export Data: No current statistics, obscuring the outlook for trade deficits and growth.​
  • New Home Sales and Housing Starts: Frozen data interferes with housing outlook analysis.​
  • Personal Income & Outlays (including PCE Inflation): Critical for assessing consumer health and spending, not available.​
  • Census Bureau Reports: Many demographic, business, and economics surveys are halted, diminishing context for policy choices.​

Related: Federal Reserve official pushes big interest-rate cuts