White House Anticipates No Inflation Report Next Month

The White House has indicated that the upcoming inflation report for October may not be released due to the ongoing government shutdown. If the report doesn’t come out, businesses and families might find themselves without crucial information regarding price changes.

Implications of Government Shutdown on Inflation Report

Karoline Leavitt, the White House press secretary, highlighted the potential consequences of Democrats opting to keep the government closed. This decision could hinder the release of the October inflation report, leaving both markets and the Federal Reserve lacking vital data. “This will create disarray,” Leavitt stated in a post on X.

The shutdown has resulted in many federal agencies, including the Bureau of Labor Statistics (BLS), functioning with limited staff. Since October 1, numerous federal workers have faced furlough or are working without pay, severely impacting data collection efforts.

Impact on the Consumer Price Index

The Consumer Price Index (CPI) report relies on data gathered by the BLS, which monitors approximately 80,000 prices across the nation each month. However, with ongoing data collection halted, the agency’s ability to report on price changes is restricted. A BLS spokesperson confirmed that “all active data collection activities are paused while the government is shut down.”

Effects on Policymakers and Economic Indicators

• Without the October report, businesses and policymakers may struggle to navigate economic conditions.
• Stephen Kates, a financial analyst at Bankrate, suggested that, irrespective of the report’s publication, prices will likely trend upward.
• Former BLS commissioner Erica Groshen noted that the Federal Reserve may lack essential information for making informed monetary policy decisions.

The absence of the October inflation report poses a significant dilemma for economic planners. The Federal Reserve typically relies on such reports to guide its interest rate adjustments. Without this key data, they may seek alternative indicators but may miss critical insights.

Recent CPI Trends

The most recent CPI report for September, which was delayed from its original release date of October 15, reported a year-over-year increase of 3%. This number was consistent with the beginning of the year and slightly below the anticipated 3.1% rise.

Moreover, on October 10, the BLS noted it had rescheduled the September report for October 24, primarily to assist in determining the annual Social Security cost-of-living adjustment. However, the agency has not announced rescheduling for other significant data releases affected by the shutdown.

The prolonged government shutdown continues to have ramifications not only on federal employees but also on vital economic statistics that influence policymaking and everyday financial decisions. As the situation evolves, stakeholders across various sectors will be closely monitoring developments.