To understand what’s driving the move, it helps to look at how other assets are reacting in the same environment. The Dow Jones Industrial Average is clearly outperforming the Nasdaq as investors digest the government restart with mixed sentiment. The Dow is generally viewed as more defensive, with a higher share of stable, mature companies, while the Nasdaq is heavily tilted toward higher-beta tech stocks. Bond yields are moving lower, a classic sign of investors shifting into safe-haven assets. At the same time, market expectations for a Fed rate cut in December have barely changed.
When delayed US macro data could finally hit the tape
After a 43-day shutdown, federal agencies will need more than a week to get back to normal. Staff are expected to return starting Thursday, but they face a massive backlog of pending work. For markets, the most critical gap is the block of economic data that hasn’t been collected or published over the past month and a half.
The Bureau of Labor Statistics (BLS) has essentially been operating with a single employee, aside from a brief return to release September CPI. It will take several days just to restore normal operations, after which the BLS is expected to publish an updated release calendar. Economists widely assume that the November nonfarm payrolls (NFP) report will be delayed by at least a week — landing uncomfortably close to the next Fed meeting.
What happens to the missing economic reports
There is also a real risk that some of the missing data never sees the light of day. White House Press Secretary Karoline Levitt has warned that the October CPI and NFP reports might not be published at all, simply because there was no staff in place to gather the underlying data. Economists now have to wait for clarification from the BLS, but in the meantime the information vacuum is adding to market anxiety.
Most analysts agree that, if those figures were available, they would likely point to a softer US economy than previously assumed. Official labor-market data could come in weaker than private estimates, while inflation would still look uncomfortably high. In that scenario, the Fed would be less inclined to cut rates in December, putting further pressure on risk appetite.
Why markets still show cautious optimism
The worst-case setup for markets is one where key data points are missing and investors have no solid basis for pricing the Fed’s December decision. Over the past couple of weeks, the implied odds of a rate cut have been drifting lower and now sit just above 50%. In such an environment, markets tend to move into a defensive stance: bond yields fall, the dollar loses some ground, and gold becomes more attractive.
The reopening of the government is, on its own, supportive for risk sentiment because it removes one source of uncertainty. But at the same time, it raises a new set of questions: what will the missing macro data show — and will it even be released? Until investors get clearer answers, that lingering uncertainty is likely to keep demand for safe-haven assets such as gold elevated in the days ahead.