Markets don’t pause just because official data does. With the government shutdown stretching on, we turn to the signals still flashing: ISM surveys, regional Fed reports, and futures pricing that point to a tricky mix of sticky services inflation and a softening job market. We share what we’re seeing behind the headlines, why services matter more than ever for your wallet, and how prices paid in both services and manufacturing complicate the path back to the Fed’s 2 percent target.

We walk through the latest reads from ISM Services at 69.4 on prices paid and ISM Manufacturing at 61.9, unpacking what those levels have historically meant for inflation. Then we compare the New York Fed Empire and Philadelphia Fed surveys, where input costs push higher while employment indicators sag. That tension is shaping rate expectations: markets now lean toward cuts at the late October and December meetings, betting the Fed will prioritize labor stability even as inflation lingers.

The heart of the conversation is expectations. When consumers believe prices will be higher in a few months, they buy early, demand tightens, and inflation gets a second wind. We talk about how the Fed’s tone can cool that loop without over-tightening growth, and why guidance about 2026 could anchor medium-term inflation expectations. If you’re watching interest rates, planning budgets, or managing risk, these signals help you navigate a noisy moment with clearer context.

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