Shutdown Fed rate cuts
Federal Reserve President Jerome Powell speaks at a press conference on September 17, 2025 after a two -day meeting of the Federal Open Market Committee on the Federal Reserve on Washington DC.
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If there is any doubt about whether the Federal Reserve will reduce the key interest rate in the following months of this month, a few blocks in the country’s capital may have strengthened the logers.
Especially if a few days pass, the chair Jerome Powell and other central bankers will probably be careful, then there will be a prejudice to expand.
“The closure of the US government and the related data delays, what we have judged is that there is an even more accurate sacrifice in October,” Evercore Heat said Krishna Guha. He said.
The authority added that the potential damage obtained without locking with the ongoing concerns about the labor market will outweigh inflation concerns.
“Despite a cautious language from the FED officials-Fed officials-FEDs in the projections published last month until the end of the year Fed’s timely labor market will get enough assurance in the labor market” reflects.
At the September meeting of the Federal Open Market Committee, the narrow majority of the authorities showed the preference of two cuts instead of one by the end of 2025. Some expressed their concerns that tariffs can even further increase inflation. Most, however, it is not possible that the effects will stop the temporary and inflation in a few years of the FED to restore a gradual softening tendency that will bring back to 2% target.
According to CME Group, the markets were priced in December to the price of 100% October deduction and 88% chance. Fedwatch Term transaction prices viewer. Both are higher when Lockout starts at midnight Thursday.
Bank of America showed that history showed that when the FED met on October 28-29, and the authorities will update the data at hand. However, if the dead end continues until then, the bank’s economists see two reasons why FOMC members voted to cut.
“First of all, it would be intact [September] Job report [October] Keep it in the game. If [September] Job data are not available, President Powell will probably be forced for another ‘risk management’ cut.
. Congress Budget Office Estimates Every day when the government remains dark, the total compensation cost will mean the dismissal of 750,000 workers with $ 400 million.
In previous lockouts, workers were brought back to work with Backpay. However, President Donald Trump threatened the existing federal payroll levels and the likelihood of some Furloghs to be permanent.
This may damage a repeated labor market, which sees special payrolls in September, according to 32,000 decreases in September. If the closing persists, a wider study of the statistical offices containing government employees will not be released as planned on Friday.
