21 January, 2019
According to the economic schedule, we are supposed to get the release of key housing data tomorrow, including housing starts, building permits and existing home sales.
However, we will only be getting the last of those, because of the government shutdown.
The closure of some US government departments due to running out of money from budget appropriations has thrown the economic calendar in disarray, which naturally will make investors nervous given the lack of information.
But it’s not all data releases that have been affected, and this has made tracking US economic data (and fundamental analysis) a lot more difficult, with even experts having trouble keeping track of what is released, and when.
So, here’s a summary of what data we might be missing going forward as long as the shutdown continues.
Because Congress failed to pass a comprehensive budget by the deadline of October 1 of last year, there have been a series of legislation called Continuing Resolutions to keep funding certain areas of the government for short bits of time.
This means that certain departments of the Federal Government have money to keep functioning for longer than others, so not all departments will close at the same time.
There is also a distinction between what is deemed as essential and non-essential services. Essential Services (i.e. social security, the military, Homeland Security, etc.) continue regardless of the shutdown.
Data releases from essential services of the government will keep being published, while those from non-essential services will be put on hold until the government reopens.
The shutdown also only affects the Federal government, which means that data compiled by other institutions will continue to be released. Most significant among them is, of course, the Fed, which is self-funded (actually, it often generates a profit for the Federal government). Data releases – and FOMC decisions – from the Fed will continue according to schedule.
Data releases from trade institutions and private surveys such as Markit (for PMI data), or the National Association of Realtors (for existing home sales) will continue to be published regardless of the shutdown as well. The same applies forstate data, such as the gaming update from the state of Nevada, as well as universities, such as the Michigan Consumer Sentiment Index.
So far, the Bureau of Economic Analysis, Department of Agriculture and the Census Bureau have run out of money, and will not be publishing their reports until a deal is reached in Congress.
This covers international trade figures, public pensions, housing data, durable goods, agricultural prices and production, GDP, and personal income. The Commodity Futures Trading Commission has stopped releasing it’s weekly data on commodity markets, as well.
Importantly, unlike during the last shutdown, the Labor Department has funding until September of this year, so we will still be getting initial jobless claims and NFP data until then (as well as ADP Jobs Report, since that is compiled by a private company).
Following the shutdown, employees of the affected agencies are not able to go out to get the data needed to compile the reports. The most prolific reporter of economic data is the Commerce Department which has been closed since December 22 and has not been collecting data.
This means that when the government does reopen, it will be missing data to issue reports, and this will lead to reports being skewed following this data gap for months to come.
Some of the data will be available for immediate release upon the reopen, and others will have to be compiled and published with a delay. Some of the future dates of the economic schedule might be adjusted as well.
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