NAB Morning Call Dancing in the Dark
Oct 1, 2025
Gavin Friend, a NAB Markets researcher based in London, joins to explore the implications of the US government shutdown on crucial data. He discusses the surprisingly low ADP job numbers and what that indicates for labor trends. The conversation shifts to the ISM manufacturing survey, contrasting it with PMI readings, and dives into Japan’s Tankan survey, hinting at the political significance of recent leadership votes. Gavin also examines European inflation stability and previews upcoming Australian economic indicators, all while analyzing market reactions.
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Data Darkness From US Shutdown
- The US government shutdown removes timely federal data, forcing markets to rely on private indicators like ADP and PMIs.
- That data gap increases uncertainty about labour conditions and monetary policy reaction paths.
Shutdown Likely To Be Prolonged
- Prediction markets and early rhetoric suggest the shutdown could persist at least two weeks, raising the chance of federal worker layoffs and prolonged data gaps.
- Political arithmetic (Senate votes) means compromise is uncertain and market participants must price in delay risks.
ADP Shows Softer Payrolls After Recalibration
- ADP reported a 32,000 fall in private payrolls for September and revised August sharply lower due to recalibration with BLS data.
- Annual benchmark revisions mean headline private payroll trends could be flatter or negative once full adjustments arrive.