US Shutdown? CPI Released Still, Why Is the NFP Delayed?
The CPI can still be released because it's processed by the BLS and used to calculate COLA (Social Security Benefit Adjustments). Therefore, the BLS is allowed to recall staff to complete the release despite the shutdown.
Meanwhile, the NFP (Employment Situation) requires two surveys: the CES (establishments) and the CPS (households). The CPS is run by the Census Bureau (under the Department of Commerce). If the Census is affected by a shutdown, key data for the employment report is incomplete or delayed, so the release is usually postponed until operations return to normal. This also happened during the 2013 shutdown (the employment report was postponed).
Despite the US government shutdown, the BLS is still releasing the September CPI tonight at 7:30 PM WIB. The agency even recalled special staff to complete the report because it's crucial for calculating COLA (Social Security Benefit Adjustments). So, the release isn't canceled, just delayed from the normal schedule.
The main focus is the monthly core CPI because it's the most recent and serves as the Fed's reference. Second, the annual core CPI to assess trends. Third, the monthly headline CPI, which is often influenced by energy. Finally, the annual headline CPI. A quick guideline: if the monthly core is around 0.2 percent, the market tends to be relieved, around 0.3 percent, it's neutral, and above 0.4 percent, the dollar usually strengthens, while gold and silver are under pressure.
These CPI results directly feed into the Fed's October 28-29 meeting. The market believes the possibility of a 25 bps rate cut is still open, but a hotter CPI figure could dampen that intention. The bottom line: tonight's data is an indicator of next week's decision.
Market scenario: if the CPI is above forecast, the USD typically strengthens, gold and silver weaken, global stocks tend to fall, and oil could weaken due to fears of demand being suppressed by interest rates. If the CPI is below forecast, the opposite is true: the USD weakens, gold and silver are relieved, stocks strengthen, and oil could rise slightly due to improving growth prospects.
What to monitor? Focus on the core month-to-month and core year-to-year figures as signals of underlying price trends. Also, pay attention to the subsequent US PMI releases as a "complement" to sentiment direction. The time is clear: 7:30 PM WIB, the numbers are released, and the market reacts immediately. (asd)
Source: Newsmaker.id
