Government Shutdown Uncertainty Could Hold Back Fed Rate Decision in December

A potential U.S. government shutdown and the resulting disruption of economic data releases are raising concerns about the Federal Reserve’s upcoming decision on interest rates. Analysts Simon Ballard and Al Maha Al Nuaimi, from First Abu Dhabi Bank, have stated that this uncertainty makes it difficult to predict economic performance, potentially leading the Fed to hold off on further rate cuts in December. They suggest that this shutdown-induced uncertainty might strengthen the Fed’s rationale for delaying a rate cut, despite potential resistance from board member Milan.