Data Reporting Lags from Shutdown Complicate Fed's Rate Decision Amid Increase in Unemployment Claims

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Data Reporting Lags from Shutdown Complicate Fed's Rate Decision Amid Increase in Unemployment Claims

Bitget-RWA2025/11/21 10:38

By:Bitget-RWA

- U.S. jobless claims rose to 232,000 in the week ending October 18, exceeding forecasts and indicating a cooling labor market despite a recent decline in initial claims. - Continuing claims hit 1.957 million, the highest since early August, while a government shutdown delayed data releases, creating uncertainty ahead of the Fed’s December meeting. - The Fed’s rate-cut probability dropped to 30% as mixed labor market signals weakened arguments for aggressive easing, with Bitcoin and Treasury yields reactin

For the week ending October 18, U.S. unemployment claims reached 232,000, surpassing analyst forecasts and indicating a slowdown in the labor market, even as initial claims had recently declined

as reported

. Figures from the Labor Department’s historical records show an increase from the previous week’s 219,000 and

higher than the expected 223,000

. Ongoing claims, which track those still receiving benefits, rose to 1.957 million,

the most since early August

. The economic outlook has become more uncertain due to the delayed data release caused by the government shutdown, with three weeks of claims data still unavailable

according to analysts

The Labor Department has stated it will not issue October’s employment report,

adding to the uncertainty

ahead of the Federal Reserve’s December meeting. Fed policymakers are now divided on whether to maintain or lower rates,

with the odds of a December rate cut falling to 30%

from 62% just a week ago. The labor market’s mixed signals—

with hiring slowing but unemployment relatively steady

—have made the case for aggressive rate cuts less compelling. “Even a slight uptick in unemployment would be a strong indication that the economy needs more support,” said Ed Al-Hussainy of Columbia Threadneedle

based on market analysis

Data Reporting Lags from Shutdown Complicate Fed's Rate Decision Amid Increase in Unemployment Claims image 0

The uncertainty in the data has unsettled financial markets.

Bitcoin

dropped below $86,000, wiping out gains made in 2025, as diminishing expectations for a Fed rate cut reduced risk appetite

according to reports

. Bond markets are also tense,

with 10-year Treasury yields staying near 4.13%

as investors await the September jobs report, which is now set for November 20. Meanwhile, the housing sector remained strong,

with existing-home sales reaching their highest level in eight months

in October as mortgage rates fell.

The government shutdown also postponed the September employment report,

now expected on November 20

. Economists are forecasting 58,000 new nonfarm jobs and a 4.3% unemployment rate. However,

the lack of October data has led policymakers

to turn to other indicators, such as state-level claims and seasonal adjustments.

With the Fed facing gaps in key data, investors are staying cautious. “The Fed won’t have much additional top-tier data before the meeting,” said Dan Carter of Fort Washington

according to market analysis

. The next steps will depend on whether the delayed September report points to a labor market that supports further easing or suggests a pause is needed. For now, volatility dominates as traders await more clarity—or brace for continued uncertainty.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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