How the government shutdown will keep crucial data from investors and policymakers

"The government shutdown that began Wednesday will deprive policymakers and investors of economic data vital to their decision-making at a time of unusual uncertainty about the direction of the U.S. economy.The absence will be felt almost immediately, as the government's monthly jobs report scheduled for release Friday will likely be delayed. A weekly report on the number of Americans seeking unemployment benefits - a proxy for layoffs that is typically published on Thursdays - will also be postponed."

"If the shutdown is short-lived, it won't be very disruptive. But if the release of economic data is delayed for several weeks or longer, it could pose challenges, particularly for the Federal Reserve. The Fed is grappling with where to set a key interest rate at a time of conflicting signals, with inflation running above its 2% target and hiring nearly ground to a halt, driving the unemployment rate higher in August."

""The job market had been a source of real strength in the economy but has been slowing down considerably the past few months," said Michael Linden, senior policy fellow at the left-leaning Washington Center for Equitable Growth. "It would be very good to know if that slowdown was continuing, accelerating, or reversing.""

A government shutdown halts release of key economic data, including the monthly jobs report and the weekly unemployment-claims update, and can delay the October inflation and monthly retail sales reports. Short shutdowns produce limited disruption, but prolonged delays would remove timely inputs for policymakers and investors during unusual economic uncertainty. The Federal Reserve faces conflicting signals: inflation above its 2% target while hiring has slowed and unemployment rose in August. The Fed reduced its benchmark rate recently and signaled further cuts are likely, but future decisions depend on data that may be unavailable if reporting remains suspended.

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