Big Take Is the Fed Flying Blind?
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Oct 29, 2025 Amara Omeokwe, a Bloomberg reporter focused on the Federal Reserve, and Enda Curran, a macroeconomic specialist at Bloomberg, dive into the recent interest rate cuts and the implications of a government shutdown. They discuss how furloughs are affecting key economic data and the Fed's reliance on private-sector indicators. The duo also explores the potential contenders to succeed Jerome Powell, highlighting their backgrounds and impacts on future policy. Unearthing how these changes could influence Fed independence, this conversation is packed with critical insights.
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Fed Shifted Focus To Labor Market
- The Fed shifted focus from inflation to a weakening labor market and cut rates twice as a result.
- Officials used private indicators because government jobs data became unreliable during the shutdown.
Shutdown Created A Data Void
- The government shutdown deprived the Fed of key official data from BLS and BEA, complicating policy choices.
- Officials relied more on private-sector gauges but warned prolonged data gaps would make decisions harder.
Use Private Data, But Treat It Tentatively
- Monitor private-sector labor and confidence indicators when official data are missing.
- Treat those gauges as provisional and adjust policy expectations if official reports resume and diverge.