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    U.S. Government Shutdown Enters Fourth Week: All Eyes on CPI as Key Economic Data Stalls

    Story Highlights
    • U.S. government shutdown halts major economic data, leaving CPI report as the sole focus.

    • QCP Capital says mild inflation could spark Bitcoin rally amid improving liquidity and stable yields.

    • CPI report on Friday could decide Fed’s next policy move and shape crypto’s direction.

    As the U.S. government shutdown enters its fourth week, most major economic reports have been paused with agencies like the Bureau of Economic Analysis and the Census Bureau halting operations. 

    This leaves just one key number in focus, the September Consumer Price Index (CPI), set to be released on Friday, October 24.

    Shutdown Leaves Investors “Flying Blind”

    According to a recent report from QCP Capital, this week’s CPI report is now the only major economic data point left for the Federal Reserve before it decides its next policy move.

    Since the shutdown began on October 1, about 800,000 federal workers have been furloughed, pausing key reports like jobs, retail sales, and housing data. The The Bureau of Labor Statistics (BLS) will still release September’s CPI this Friday under a limited exemption, but no other updates will follow until funding resumes.

    “Policymakers are operating in near darkness,” said JPMorgan’s chief economist Michael Feroli, noting the Fed must now rely on private data and market signals to gauge inflation and growth.

    CPI Holds the Key for Crypto

    For the crypto market, this CPI report could be a big deal. QCP said that if inflation rises only slightly around 0.2% and core inflation stays near 0.3%, it would support hopes for a “soft landing” for the U.S. economy, where prices stay stable without hurting growth.

    According to QCP, Bitcoin usually performs well when inflation is mild. In August, a similar CPI report was followed by a 12% BTC rally. 

    The firm believes that if this week’s numbers show the same trend, Bitcoin could see another strong move upward, especially as U.S. yields settle and liquidity improves.

    As of now, Bitcoin is trading near $108,000, down slightly by 0.5% over the past 24 hours.

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    FAQs

    How is the U.S. government shutdown affecting economic data?

    The shutdown has paused most major reports, leaving only the September CPI as the key data point for policymakers and investors.

    What is the significance of the September CPI report?

    It’s the only major economic update during the shutdown and will guide the Federal Reserve’s next interest rate decision.

    How does the CPI impact the crypto market?

    Mild inflation in the CPI often boosts crypto prices, as investors view Bitcoin as a hedge and liquidity conditions improve.

    What could happen if inflation stays low in the CPI report?

    A small rise in inflation could support hopes for a soft landing and potentially lift Bitcoin and other risk assets.

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