The ADP report carries added weight this month, as the government shutdown has delayed the Bureau of Labor Statistics (BLS)official September jobs report (originally scheduled for release on October 3), along with weekly unemployment claims data.
What’s the bottom line? This delay comes at a critical time. The Fed is balancing two competing forces: inflation that remains above target and increasing signs of a slowing economy. That tension was reflected in the Fed’s September 17 rate cut, where officials cited “rising downside risks to employment.”
The BLS jobs report was expected to play a key role in shaping the Fed’s next move at its October 29 meeting. In its absence, the ADP data takes on more importance than usual in guiding expectations.
Quick refresher: When the Fed adjusts interest rates, it’s changing the Federal Funds Rate – the short-term rate banks charge each other. This doesn’t directly set mortgage rates, but it influences them, along with other economic indicators.