The Fed Chair Powell's voice acts as a market compass amid the US government shutdown

Anon4461 · 2026-01-13T08:39:14+00:00

The U.S. government shutdown has obscured economic data releases, heightening market sensitivity ahead of the Federal Reserve's upcoming meeting. A lack of employment data has increased volatility, with markets anticipating a modest interest rate cut, revealing uncertainty amidst mixed signals on employment and inflation. Jerome Powell's upcoming remarks are expected to clarify the Fed's stance and provide crucial insights for market participants.

Anon4461

2026-01-13 08:39:14

Abstract generation in progress

As the US government shutdown blocks the release of economic indicators, the market’s focus on interpreting the Fed’s next move has become even more sensitive. In particular, ahead of the Federal Reserve meeting on October 29, Chairman Jerome Powell’s remarks and the minutes of the Federal Open Market Committee(FOMC) are being closely watched as key signals influencing investors’ decisions.

Uncertainty Created by Employment Data Gaps

The information gap caused by the delay in the September employment report has increased volatility in the spot market. In this environment, the market is about 90% confident that the Fed will cut interest rates by only 25 basis points next month. However, while private sector employment figures are showing weakness, inflation expectations remain high, making the situation complex.

The Challenge Powell Must Address in His Speech

In this context, Chairman Powell’s remarks are expected to provide direction to the market. They will be crucial in determining whether the Fed’s policy stance is truly leaning toward easing or if it will remain cautious due to inflation concerns. At the same time, the minutes of the meeting will offer insights into the actual distribution of opinions among FOMC members, helping financial market participants adjust their positions accordingly.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.