Friday, January 19, 2018

Government Shutdown: Economic Data Likely to be Delayed

by Bill McBride on 1/19/2018 12:46:00 PM

In previous shutdowns, Government data from the BLS, BEA and Census Bureau were delayed. Data from the Federal Reserve was released on time.

As an example, if the government shuts down, I expect New Home sales, durable goods and Q4 GDP to all be delayed next week. Unemployment claims will probably be released on time (and increase the following week due to the shutdown).

The following week, the key report that will probably be delayed is the employment report for January.

In addition, any shutdown will be expensive and impact Q1 GDP. From Goldman Sachs:

A shutdown would have a modest economic impact, provided it does not last very long. We estimate that each week of shutdown would reduce real GDP growth in Q1 by 0.2pp, qoq annualized. The effects would be reversed the next quarter however.
Hopefully the shutdown will be avoided.