For the primary time in additional than a century, America is about to go darkish on its inflation stat. With Bureau of Labor Statistics employees furloughed as a result of shutdown, there can be no Client Value Index and no official measure of the price of dwelling, nor a baseline for the markets.
What the hell? So the CPI report beneath Trump can be simply smoke and mirrors? This comes at a time when many are arguing that CPI is rigged within the US, like in Banana republics.
Anybody who pays family payments can see the associated fee inflation in actual time, and it’s far more than 3%. Economists and merchants are actually navigating blind, improvising the place the world’s most-watched inflation gauge was once.
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CPI Inflation Stat: Is The US F*cked?
“just about NO INFLATION” says the billionaire politician who hasn’t needed to store at regular shops in many years.
Similar to Biden was mendacity, Trump is mendacity. pic.twitter.com/innsKZL1K2
— An0maly (@LegendaryEnergy) October 6, 2025
We’re presently observing a traditional late-cycle coverage error in real-time:
Curiosity Charges & The Fed: The Fed has begun chopping, bringing the goal vary to 4.00-4.25% as of September. They’re chopping right into a slowdown, frightened of the cracks forming in employment.
Inflation (The Sticky Tail): September CPI ticked as much as 3.0% (headline and core). The “final mile” to 2% has failed. The Fed is easing whereas inflation is re-accelerating, a catastrophe situation for bond actual yields and fairness valuations.
The Yield Curve Sign: The 10Y-2Y unfold is now constructive (+0.54%). Historical past exhibits the recession begins after the curve dis-inverts.
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In the meantime, for greater than a century, the CPI has tracked each rise and fall in the price of dwelling with out interruption. That document ends this month. With authorities statisticians furloughed and no new information collected, that is including extra stress to an already traumatic US financial surroundings.
“With out well timed inflation information, households can’t funds, firms can’t plan, and traders are primarily buying and selling on fiction,” stated Jon Hill, head of U.S. inflation technique at Barclays.
Now That CPI Is Gone, What’s Subsequent? The Drawback with the “Fallbacks”
With no CPI information to anchor markets, two fallback methods have taken their place and so they don’t match. The US Treasury assumes inflation will proceed on the previous yr’s common tempo.
The ISDA, which governs swaps, froze inflation eventually October’s stage: 3.01%.
The result’s a warped market. Barclays estimates that the break up now implies a 3.05% breakeven fee for TIPS versus simply 1.78% for inflation swaps, and it is a gulf broad sufficient to interrupt fashions that when moved in sync.
For crypto merchants, it is a rupture in one of many world’s core pricing methods.
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Prediction markets aren’t optimistic. Polymarket contracts give lower than a 30% probability that CPI information drops earlier than November.
With out CPI, the Fed walks into its October assembly half-blind. Bond auctions threat distortion, and macro fashions may begin spitting out false indicators.
If the shutdown drags on, the divide between TIPS and swaps may widen additional, twisting the yield curve and leaving economists guessing what’s actually occurring.
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Key Takeaways
For the primary time in additional than a century, America is about to go darkish on its inflation stat. With Bureau of Labor Statistics furloughed.
If the shutdown drags on, the divide between TIPS and swaps may widen additional, twisting the yield curve.
The put up US Inflation Stat Faces Chaos as Authorities Shutdown Freezes BLS Knowledge appeared first on 99Bitcoins.
