Government Shutdown Ends

The longest U.S. government shutdown in history ended after 43 days, with President Trump signing a funding bill on November 13. The deadlock disrupted government services, furloughing or leaving about 1.4 million federal employees unpaid. Focus now shifts to reopening and addressing delays in data and payments, according to J.P. Morgan Insights.

While backpay will be distributed soon, other spending will be released gradually. During the shutdown, federal agencies, including the Bureau of Labor Statistics, paused operations, delaying key economic data like jobs reports and CPI, complicating Fed decisions.

Fed chair Powell dismissed expectations of more easing this year, but J.P. Morgan foresees another 25 basis point cut in December due to concerns about the labor market.

The outlook remains uncertain without crucial data.

The Congressional Budget Office estimates Q4 GDP will drop 1.5%, with a rebound of 2.2% in Q1 2026. Each week of shutdown reduces annualized GDP growth by about 0.1%.

We will keep an eye on all of this for our Federal Government Employee clients, hoping to see a rebound back to normalcy as soon as possible.