The government has entered into shutdown for the first time in 17 years.
As a result, regular economic data releases put out by the Department of Labour and the Commerce Department — for example, the monthly nonfarm payrolls report — won’t be released.
A lot of the datapoints that economy watchers follow these days, however, are put out by private firms, so investors will still be able to piece together a reasonable picture of how economic growth is progressing, even though the government has shut down.
The most-anticipated government-released report in the coming days is the monthly nonfarm payrolls (a.k.a. “jobs”) report, which is scheduled for 8:30 AM ET on Friday.
On Wednesday, we get payroll-processing firm ADP’s estimate of the change in total private-sector payrolls in September.
“The ADP report has improved significantly as a forecasting input for private payrolls over the past year,” says Deutsche Bank chief U.S. economist Joe LaVorgna. “Therefore, in the event that the employment report is delayed, we will be comfortable relying on the ADP series as a close proxy of September hiring.”
The Commerce Department is scheduled to release two economic datapoints this week: August construction spending, which was due out this morning, and August factory orders, to be released Thursday.
While there may not be a particularly close analogue for construction spending in private-sector data releases, investors can arguably look at a host of non-government data releases to get a feel for the pace of U.S. manufacturing growth while the government remains shut down.
On Tuesday morning, at 8:58 AM ET, Markit released the final results of its manufacturing PMI (Purchasing Managers Index) survey, which tracks metrics like growth in production and new orders in the U.S. manufacturing sector. The index was unchanged at 52.8, suggesting that American manufacturing continued to expand in September at the same pace as in August.
The ISM’s monthly report on manufacturing — due out at 10 AM on Tuesday — also tracks metrics similar to those in Markit’s PMI survey. The headline index from the ISM report rose to 56.5 from 54.0, suggesting that the pace of expansion in American manufacturing is actually accelerating.
The Commerce Department is also scheduled to release August trade balance data next Tuesday, October 8, and August wholesale inventories data on Wednesday, October 9, while the Bureau of Labour Statistics is scheduled to release the September producer price index on Friday, October 11. If the government is still shut down, investors can again revert to the Markit PMI and ISM manufacturing releases, which both track growth in imports, exports, inventories, and input costs.
Furthermore, regarding trade data, ambitious economists can always piece together a report by compiling the stats published by the U.S.’s various foreign trading partners.
The “new export orders” sub-index of Markit PMI release fell to 49.0 from August’s 52.0 reading, suggesting that exports began to shrink over the past month. The “stocks of purchases” sub-index rose to 47.8 in September from 46.2, indicating that manufacturers continued to reduce inventories last month, but at a slower pace than in August. The “input prices” sub-index, meanwhile, fell to 55.7 from 56.2, indicating a slowdown in producer price inflation over the past month.
The “new export orders” sub-index of the ISM manufacturing report fell to 52.0 from August’s 55.5 reading, suggesting a slowdown in export growth, but not an outright turn to contraction as the Markit PMI report indicated. The “imports” sub-index fell to 55.0 from 58.0, indicating a slight slowdown in import growth. Meanwhile, the “inventories” sub-index rose to 40.0 from 47.5, suggesting inventory levels were unchanged in September, contrary to the Markit PMI report. The “prices paid” sub-index rose to 56.5 from 54.0, suggesting that the pace of inflation is accelerating — also contrary to the Markit PMI report.
Finally, retail sales are also due to be published by the Commerce Department next Friday, October 11. Perhaps the best proxy for this datapoint is the ICSC-Goldman Store Sales Index, published every Tuesday morning at 7:45 AM by the International Council of Shopping Centres.