The Federal Reserve’s Oct. 28–29 meeting arrives amid an unprecedented data freeze triggered by a partial U.S. government shutdown. With Bureau of Labor Statistics staff furloughed, the crucial September jobs report remains unreleased, complicating the Fed’s policy decision.
Market consensus, reflected in CME Group’s FedWatch Tool, assigns a 96.2% probability to a 25 basis-point rate cut, with minimal odds of no change. However, the absence of official labor data and persistent inflation pressures introduce significant uncertainty. A surprise pause or delay in easing could disrupt both equities and crypto.
Crypto markets, particularly bitcoin, have benefited from haven demand amid shutdown fears, pushing prices near record highs above $125,000. Safe-haven inflows have coincided with robust ETF demand; yet, analysts warn that a stronger-than-expected inflation or hawkish Fed signal could trigger rapid sell-offs.
Equities sit at decade highs, pricing in smooth policy transitions. A pause in rate cuts risks undermining investor confidence and may spark volatility across asset classes. Historical precedents during data blackouts show the Fed has often opted for caution, suggesting a non-zero chance of policy divergence from market expectations.
Alternative data sources, including private sector employment indicators and regional Fed reports, will provide partial insights. Still, these proxies lack the comprehensive scope of BLS releases. If the shutdown extends into mid-October, delayed official data could emerge just before the FOMC decision, offering last-minute clarity.
Traders are now hedging positions around critical thresholds. Crypto levered derivative markets display clustered liquidation zones near $120,000 for bitcoin, while S&P 500 futures show implied volatility spikes in event-risk scenarios. The Fed’s communication on data dependence and economic outlook will be pivotal in guiding next-day trading across global markets.
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