{"id":97375,"date":"2025-10-25T13:20:09","date_gmt":"2025-10-25T13:20:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/97375\/"},"modified":"2025-10-25T13:20:09","modified_gmt":"2025-10-25T13:20:09","slug":"good-inflation-news-gives-some-relief-but-the-feds-flying-blind-from-here","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/97375\/","title":{"rendered":"Good inflation news gives some relief \u2014 but the Fed\u2019s flying blind from here"},"content":{"rendered":"\n

This is The Takeaway from today’s Morning Brief, which you can sign up<\/a> to receive in your inbox every morning along with:<\/p>\n

Inflation came in better than expected<\/a> in September, a welcome downside surprise that gives policymakers a bit more breathing room<\/a> as they weigh another rate cut.<\/p>\n

It was exactly the kind of reading the Fed (and investors<\/a>) wanted to see: softer shelter, moderating core services, and just enough cooling across key categories to keep the Fed comfortable \u2014 for now.<\/p>\n

But with the government still shut down<\/a> and key data frozen in time, the Fed\u2019s view of the economy is about to get blurry. As RSM chief economist Joe Brusuelas warned, \u201cThis is likely to be the last solid quality report we get until probably early next spring.\u201d<\/p>\n

In other words: The Fed is flying blind.<\/p>\n

Brusuelas explained that while an eventual end to the shutdown will resume key economic releases, the gap in data collection means the quality of those numbers will suffer for months, leaving policymakers to navigate largely on estimates and assumptions.<\/p>\n

\u201cThe BLS is going to be imputing \u2014 or rather guessing \u2014 at a lot of the estimates they\u2019re making,\u201d he said. \u201cSo in many respects, this is the last hard data that I\u2019m going to trust probably until early next spring.\u201d<\/p>\n

That\u2019s the same warning sounded by Bank of America, which titled its latest FOMC preview \u201cDon\u2019t change course when flying blind.\u201d The bank expects the Fed to cut rates by 25 basis points next week while simultaneously avoiding strong guidance \u201cgiven the lack of official sector data.\u201d<\/p>\n

\"El Fed Chair Jerome Powell. (AP Photo\/Jacquelyn Martin) \u00b7 ASSOCIATED PRESS <\/p>\n

Complicating things further, even though the September inflation report was relatively benign, there are early signs that tariffs<\/a> are beginning to ripple through prices. Apparel, footwear, and household furnishings all showed early signs of pass-through last month.<\/p>\n

\u201cGoods prices are firming again amid tariff pressures,\u201d said Gargi Chaudhuri, chief investment strategist at BlackRock.<\/p>\n

Economists warn those pressures are only set to build, even if they\u2019ve been slow to show up in the data. So far, companies have absorbed most of the tariff costs \u2014 but that won\u2019t last forever.<\/p>\n

Economists at BNP Paribas and Goldman Sachs expect more noticeable pass-through to consumers heading into early 2026, particularly in the more trade-sensitive categories that showed gains last month. Bank of America economist Steven Juneau added that tariffs will remain a \u201csource of goods price inflation\u201d over the next few quarters as inventories deplete, margins shrink, and firms pass on costs to consumers.<\/p>\n","protected":false},"excerpt":{"rendered":"This is The Takeaway from today’s Morning Brief, which you can sign up to receive in your inbox…\n","protected":false},"author":2,"featured_media":97376,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,64896,184,64897,85,46,40148],"class_list":{"0":"post-97375","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economic-data-releases","10":"tag-economy","11":"tag-flying-blind","12":"tag-il","13":"tag-israel","14":"tag-the-fed"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/97375","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=97375"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/97375\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/97376"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=97375"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=97375"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=97375"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}