The suspension is over, and the flood peak is coming: After 43 days of "information vacuum," how will the backlog of data impact the market?

Written by: Frank, MSX Research Institute

43 days, the longest government shutdown in American history.

On the evening of November 12, Eastern Time, after the U.S. House of Representatives voted to pass a temporary funding bill for the federal government, Trump also signed it, marking a phase-end to this political drama. According to estimates by the U.S. Congressional Budget Office, the six-week shutdown may have reduced U.S. GDP by 1.5 percentage points, resulting in a net loss of about $11 billion.

Source: White House official website

However, a more invisible and tricky problem has emerged: the shutdown interrupted the U.S. statistical system. From employment to inflation, from GDP to retail, a large amount of key economic data that should have been released daily, weekly, and monthly was absent during this period, especially core employment data such as non-farm payrolls, which are crucial for the Federal Reserve's monetary policy decisions and directly impact major measures like interest rate cuts.

Now, with the government reopening, the U.S. Bureau of Labor Statistics (BLS) and others are scrambling to "catch up," and the backlog of economic data may be released intensively in the coming weeks. This also means that after more than a month of information vacuum, investors are about to face a rare "data deluge."

The end of the shutdown is merely a political conclusion; for the market, the real test lies in the coming month, including the forced re-pricing of the economy, inflation, and interest rate paths in an extremely short time frame, which will determine the pricing logic of U.S. stocks, gold, crypto, and even global assets for some time to come.

I. What Did the Market Lose During 43 Days of "Data Blind Flying"?

Widespread flight delays, interruptions in food assistance programs, public services coming to a standstill, hundreds of thousands of federal employees on unpaid leave… It can be said that over the past 43 days, the shutdown's impact on the economy and people's livelihoods permeated every aspect of the United States.

However, for the global financial market, the biggest shock encountered was a more covert and dangerous state, namely that the market lost its "eyes" to judge the economic situation.

It is important to note that while the government can shut down, the economy does not completely stop and continues to operate daily, such as businesses hiring employees, consumers shopping, factories producing, price changes, and fluctuations in exports and imports. However, the agencies responsible for recording, summarizing, and releasing these changes simultaneously entered a pause during the shutdown:

From the Bureau of Labor Statistics (BLS) to the Bureau of Economic Analysis (BEA) and the Treasury Department's data statistics team, almost all federal units responsible for releasing core macro indicators were affected by the shutdown and ceased operations.

Without data, the market can only rely on guesswork. The last available federal official employment data before the shutdown showed an unemployment rate of 4.3% and an increase of 22,000 jobs in August, continuing the trend of slowing job creation. All core data for September and October that should have been released subsequently disappeared from the schedule.

According to statistics from MSX Research Institute, during the period from October 1 to November 13, at least 12 core macro indicators failed to be released as planned due to the U.S. government shutdown, covering the three pillars of employment, inflation, and GDP/growth, including non-farm payrolls, unemployment rate, CPI, PPI, retail sales, trade balance, industrial production, PCE, and preliminary GDP, all key indicators.

Some of this data can still be compensated for; for example, the September non-farm data that should have been released on October 3 was already collected, but the process was interrupted by the shutdown and is likely to be released once the government reopens.

More seriously, there is another part of the data that may be "permanently lost," such as October non-farm payrolls and the unemployment rate, which could be absent forever due to the inability to collect data throughout October: White House spokesperson Levitt recently stated that due to the prolonged closure of federal agencies, two important reports on October inflation and employment "will likely never" be released.

This also means that September and October 2025 may become a rare "statistical blind spot" in the U.S. macro data series.

The only exception is that, for the adjustment of social security benefits, the September CPI report was released on October 24 after a 9-day delay, becoming the only "observation window" during the entire shutdown and the only officially permitted economic data released so far.

However, this did not alleviate the market's "data thirst." More troublesome is that even though the shutdown has ended, there is still no timetable for when federal agencies can catch up, the White House has refused to provide a clear schedule, and the BLS has not yet announced a plan for supplementary releases, leaving the market still in a semi-blind flying state.

II. From "Information Vacuum" to "Data Deluge"

Nevertheless, with the government reopening, agencies will inevitably begin to process the backlog of important economic reports and work hard to "catch up."

Because of this, in the coming month, the release schedule for U.S. economic data will see an unprecedented density of releases; the 43 days of information vacuum will not end gently; on the contrary, the enormous uncertainty and volatility will be concentrated and released in a very short time.

According to projections from institutions like Goldman Sachs and Morgan Stanley, the calendar for key economic data "catch-up" in the next month will be extremely daunting, possibly marking the most crowded, chaotic, and impactful period of macro data in U.S. statistical history.

From this calendar, we can see two clear "eye of the storm."

First, the first shock point comes from the backlog of September data.

The Wall Street Journal and Goldman Sachs both pointed out that since the data collection for the September employment report was completed before the shutdown, the BLS is expected to quickly release it after resuming operations (as early as next week).

However, Goldman Sachs has an even more aggressive prediction, suggesting that the September non-farm payrolls (on November 18) and October non-farm payrolls (on November 19, if they can be released) may bombard the market back-to-back over two consecutive days.

If this scenario comes true, the market will face an extremely awkward yet potentially real situation: investors will digest two months of employment reports, which may have completely opposite directions, within 24 hours. It is important to note that non-farm payrolls are one of the most sensitive macro data points in the entire market, and two consecutive reports could directly reshape expectations for the economy and the Federal Reserve's path in 2025.

Secondly, the second shock point comes from the "black hole" and "serious delay" of October data.

In simple terms, compared to the easy catch-up of September, October is the core of the storm. After all, this shutdown covered the entire month of October, and the data collection delays far exceeded those in 2013 (16 days) and 2019 (35 days). According to Morgan Stanley's estimates, key inflation data such as October retail sales, PPI, and CPI may not be released until December 18 or 19.

What does this mean?

This means that during the interest rate meeting on December 9-10, when Federal Reserve policymakers are formulating the interest rate path for 2026, they themselves will not have access to more key inflation data from October.

In summary, this "catch-up" calendar is less about returning to normal and more like a "volatility map." The market, along with the Federal Reserve, will once again fall into a new blind spot caused by the "data deluge" from the old blind spot of "information vacuum," and will be forced to digest potentially contradictory data in a very short time.

The intense fluctuations in the market over the next month have almost become a certainty.

III. What Impacts Might Arise?

Overall, for the market, the "sigh of relief" brought by the end of the shutdown is merely a temporary emotional repair. What truly determines market trends is how this wave of "data deluge" will reshape investors' expectations for the U.S. economy and the Federal Reserve's policy path when it is concentratedly released.

Under this premise, one must be wary of the fact that this round of shutdown not only led to data absence but also may have caused data distortion. After all, the data for the October employment report was never collected, and some important parts of the November report were supposed to be collected in early November but were not guaranteed.

Therefore, all data released in the coming month will not only be late but may also carry biases, making it significantly more difficult for the market to interpret.

Given this situation, when the market digests the data deluge, three distinctly different scenarios are likely to occur, each of which will directly reshape the direction of risk assets:

• "Stagflation" Alarm: If the supplementary September non-farm payrolls, Q3 GDP, and September PCE data are all "overheated," indicating stubborn inflation and a strong economy, then the market will undoubtedly rapidly reprice "more hawkish Federal Reserve" expectations, pushing back rate cut expectations significantly. This would mean soaring dollar and U.S. Treasury yields, putting pressure on QQQ (tech stocks) and crypto as risk assets;
• "Recession" Panic: If the backlog data (especially non-farm payrolls) shows that the job market suddenly stalls and Q3 GDP falls far short of expectations, then the market will quickly shift to "recession trades," betting on an emergency rate cut by the Federal Reserve. This would mean plummeting dollar and U.S. Treasury yields, with QQQ and crypto potentially experiencing short-term impulsive rebounds due to the notion that "bad news is good news.";
• "Data Clash": If the September and October data are completely contradictory (e.g., September is very hot, October is very cold), or if employment and inflation data contradict each other, then the market will fall into cognitive confusion, with volatility reaching a peak. It is not ruled out that various risk asset prices will experience violent fluctuations (V-shaped reversals, W-shaped reversals), which is also the most likely and hardest scenario to deal with in this round.

However, regardless of the outcome, from a statistical rhythm perspective, barring any unexpected events, by early January next year at the latest, the U.S. employment and inflation chains will basically restore their integrity, and we will have a fairly clear understanding of the employment market situation. By then, the economic conditions for the fourth quarter may also be truly presented.

Of course, all of this is predicated on the fact that there will not be another government shutdown during this period… The uncertainty of U.S. politics may press the "pause button" again at any time in the future.

In Conclusion

For Washington, the end of the shutdown is a temporary conclusion to a political game; for the market, it marks the end of a halftime break—over the next few weeks, the economic realities that have accumulated over 43 days will double back, and the second half of the game will be forced to play at "fast forward."

For investors holding cash and preparing to enter the market, or traders closely watching the Federal Reserve, the real game has just begun.