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\nThe US federal government is in its third week of lockout. Visual China<\/p>\n
The federal shutdown has entered its third week. The prolonged\u201cShutdown\u201d has severely curtailed its ability to publish key market reports such as inflation and employment, according to a number of foreign media reports. Not only have us market watchers and policymakers been left\u201cData-blind\u201d by the failure to supply official US economic data, it has also left economies such as Japan and Europe, which rely on the data for decision-making, with difficult policy judgments and increased volatility in global financial markets as they lose key\u201cPointers\u201d.<\/p>\n
\nThe US federal government is in its third week of lockout. Visual China<\/p>\n
\u201cAn unsettling void.\u201d<\/p>\n
According to Politico, Forbes, Reuters and other foreign media, the federal agencies responsible for publishing indicators of U.S. economic activity include the Bureau of Labor Statistics, the Bureau of Bureau of Economic Analysis and the census, almost all data collection and release has been suspended during the shutdown. Important economic indicators such as the employment report, the Consumer Price Index and the key report on import and export prices, which should have been released on schedule, collectively\u201cFailed to produce\u201d, the data, which is seen as a bellwether for global markets, has suddenly disappeared from investors’ radar, leaving an unsettling void.<\/p>\n
\u201cThe government ‘shutdown’ has exacerbated concerns among policy makers and investors about the health of the U.S. job market, inflation trends, consumer spending and business investment, and disrupted key economic data releases,\u201d Reuters wrote in the report.<\/p>\n
The Bureau of Labor Statistics’s September jobs report has reportedly been delayed and October’s report is at risk. If the government shutdown continues into late October, tens of thousands of households will be blocked from conducting interviews on unemployment. Beyond the jobs report, the prolonged shutdown will also damage the accuracy of this month’s consumer price index, the Bureau of Labor Statistics’ core inflation gauge. The Bureau of Labor Statistics has delayed the release of its September Consumer Price Index Report until Oct. 24, more than a week after the usual time, when the data is likely to be a patchwork.<\/p>\n
Omar Sharif, president of inflation insight, bluntly stated that if the\u201cShutdown\u201d continues beyond October 23, \u201cThe CPI may not be released in October.\u201d. The lack of CPI data, as the core reference index of interest rate policy, will directly weaken the scientific nature of monetary policy decision.<\/p>\n
Officials worry about\u201cBlind economic data\u201d in US<\/p>\n
The effects of the US data outage quickly spread to the rest of the global economy. A prolonged period of\u201cBlindness\u201d in US economic data could complicate policy making at home and increase the risk of policy mistakes, Reuters reported officials as saying. Against the backdrop of a series of moves by Washington to\u201cReshape global trade\u201d, the risk of missteps is all the more acute.<\/p>\n
\u201cThis [ lack of data ] is a serious problem and we hope it can be resolved as soon as possible,\u201d Boj Governor Tateda said at a news conference on October 3, Reuters reported, the shutdown of the US government, which has disrupted the release of official economic data, could be\u201cDisorienting\u201d for policy makers in Japan and elsewhere. For these countries, understanding where the world’s largest economy is heading is an important gauge of their currencies, trade performance and inflation.<\/p>\n
\u201cThis is a joke,\u201d said a Japanese policymaker who spoke on condition of anonymity. \u201cFed Chairman Powell has always said that fed policy is ‘data dependent’ , but there is no data to rely on.\u201d<\/p>\n
The Europeans are more cautious. Catherine Mann, a member of the Bank of England’s monetary policy committee, said the direct impact of the US data disruption on the bank’s policy discussions was limited. The US data controversy has not been a\u201cCore issue\u201d in the BOE’s policy discussions, but has been included in the\u201cImplicit risk list\u201d.<\/p>\n
German\u201cFocus\u201d weekly reported that the U. S. government\u201cShutdown\u201d or a major opportunity for Europe. Given the high level of US Treasuries, a deep, liquid and safe EU bond market could provide international investors with an opportunity to diversify their risk. This would give them the option of investing their money in euro-denominated bonds rather than us treasuries.<\/p>\n
There is no substitute for private sector data<\/p>\n
In the official data also\u201cOff\u201d the background, some non-official information channels are still operating. The Fed, which is self-financing and unaffected by the government shutdown, is still collecting economic information through its extensive network of contacts, Reuters reported. Alternative Data would also be available from private data services and would meet basic needs despite shortcomings. In response, Germany’s Binance News Network quoted experts as warning on the 15th, even if there are other data sources, they can not replace the United States agencies usually provide official, comprehensive data sets.<\/p>\n
Adam Posen, a Peterson Institute for International Economics and former policy maker at the Bank of England, said the \u201cShutdown\u201d of the government and the current turmoil at the Bureau of Labor Statistics, \u201cIt will fuel critical questions about US governance and reliability. This will ultimately affect reserve management and monetary decision-making, and increase the volatility of expectations in the US economy.\u201d.<\/p>\n
At a joint meeting of the World Bank and the International Monetary Fund in Washington this week, global economic leaders faced multiple issues, including the situation in the Middle East, but US data\u201cOff-supply\u201d is still the focus of the debate. \u201cIf the technical agencies responsible for data collection and dissemination come under pressure, it could also undermine public and market trust in official statistics, making it much more difficult for central banks and policymakers to set policy… … If political interference results in impaired data quality, reliability and timeliness, it will further increase the probability of decision-making errors.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
The federal shutdown has entered its third week. The prolonged\u201cShutdown\u201d has severely curtailed its ability to publish key market reports such as inflation and employment, according to a number of… <\/p>\n","protected":false},"author":1,"featured_media":6979,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[257],"tags":[3530,176,3531,956,3074],"views":210,"_links":{"self":[{"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/posts\/6978"}],"collection":[{"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6978"}],"version-history":[{"count":2,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/posts\/6978\/revisions"}],"predecessor-version":[{"id":6981,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/posts\/6978\/revisions\/6981"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=\/wp\/v2\/media\/6979"}],"wp:attachment":[{"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6978"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6978"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/forefrontnews.cn\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6978"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}