Street Calls of the Week
Investing.com - A crucial reading of nonfarm payrolls, initially due out on Friday, will likely be delayed by an ongoing U.S. government shutdown.
The postponement will leave investors without one of the most closely-monitored gauges of the health of the American labor market.
These readings have becoming especially important in recent months as the Federal Reserve assesses the path ahead for interest rates. Last month, the central bank slashed rates by 25 basis points, partially citing a need to prioritize a cooling jobs picture over sticky inflation. In theory, rate reductions can boost investment and hiring, albeit at the risk of fueling price gains.
Fed policymakers also signaled a willingness to further slash borrowing costs at their remaining meeting this year. The Bureau of Labor Statistics’ employment report could have swayed bets on whether an additional cut could come as soon as the Fed’s upcoming gathering later in October.
Still, as Chicago Fed President Austan Goolsbee has suggested, U.S. central bankers will now have to seek out alternative data sources.
Other private-label statistics are available from payroll processor ADP, as well as job posting website Indeed. Separate figures from analytics company Revelio Labs also utilize networking platforms to track trends in areas such as employment, salaries, and hiring.
Analysts have also suggested that consumer and business surveys could help to fill in the blanks left by the absence of the BLS report.
Beyond employment figures, non-official data will also be needed to keep tabs on everything from retail sales to consumer prices this month should the shutdown continue.
On Friday, the Institute for Supply Management’s non-manufacturing purchasing managers index for September could provide some insight into the effect of sweeping U.S. tariffs on the services sector, a segment of the U.S. economy that accounts for a major bulk of total output.
The number is tipped to edge down to 51.8, compared to 52.0 in August. A reading above 50 indicates expansion.