ADP cuts Fed access to payroll feeds (NASDAQ:ADP) while the September Consumer Price Index takes on outsized influence. The move matters now because the Federal Reserve will meet next week with very little official data due to a partial government shutdown. In the short term markets will focus on CPI and private indicators. Over time the episode highlights limits of private data for US policy makers and for global investors.

What happened and why the timing matters

The payroll processor Automatic Data Processing stopped providing a private weekly payroll series to Federal Reserve staff. NASDAQ:ADP handles roughly one fifth of private payrolls in the United States. The suspension appears to reflect the company weighing client relationships and legal risk against the value of offering a data feed to policy makers.

This is more than a procedural detail. The interruption removes a timely window into labor conditions at a moment when many government statistics offices have furloughed staff because of the partial shutdown. That left only a small group at the Bureau of Labor Statistics working to produce the September CPI report. As a result the CPI release on Thursday is the single official data point the Fed will have ahead of its meeting next week.

How CPI will shape the coming market session and the Fed’s view

The Consumer Price Index report is due at 8 30 a m Eastern. Economists expect headline CPI up 3.1 percent year over year for September, compared with 2.9 percent in August. Core CPI is forecast to hold near 3.1 percent on an annual basis. Month over month the consensus is for 0.4 percent on headline and 0.3 percent on core.

That single release will have an outsized role in shaping market tone because the Fed has fewer routine statistics to review. Short term, traders may respond to the data with moves in Treasury yields and the dollar. Financial conditions will react to any surprise in inflation that changes the perceived pace at which officials are tightening or easing their rhetoric.

In addition, the September print has a concrete near term impact. The calculation sets the January cost of living adjustment for Social Security recipients. Private groups are already projecting a 2.7 percent COLA next year. That link between CPI and benefits helps explain why the report was prioritized for production during the shutdown.

Market preview for the trading session

Traders should treat tomorrow as a focused session tied to inflation and rate expectations. Bond markets will watch the 10 year Treasury closely for moves that reflect changes in inflation expectations and term premiums. Equities will respond sector by sector. Consumer discretionary and consumer staple stocks are likely to react to any signal on real purchasing power. Financial stocks will track yields because lender margins depend on the interest rate environment.

Market participants will also gauge flows into risk assets versus safe havens. If headline inflation comes in higher than expected the dollar could strengthen on renewed rate resilience. Conversely, a softer print could lift rate sensitive names and reduce volatility. With fewer official data points this week private indicators and CEO commentary will matter more for positioning during the session.

Payment companies that publish high frequency spending data such as Bank of America NYSE:BAC, Visa NYSE:V and Mastercard NYSE:MA may provide supplemental color through their public releases. Those firms collect large samples of transactions that often move ahead of monthly government figures. That utility helps investors read trends, but it does not replace the complete coverage and consistency of government series.

Private data growth and its limitations

The private sector has expanded its role in economic measurement. Corporations with large client bases now produce timely indicators on payrolls, consumer spending, and travel. NASDAQ:ADP is one example. Major banks and card networks offer spending snapshots. The benefits are clear. Private feeds are fast and can be more granular than monthly government numbers.

However private data come with trade offs. No single company can represent the entire economy. Payroll processors do not capture public employment or self employment at the same rates as government surveys. Card networks reflect the spending patterns of their customers. Firms may manage access to data to protect client confidentiality and commercial relationships. In this episode the Fed lost one of its supplementary inputs when a private firm stepped back.

Historically government statistical agencies have provided the backbone for policy making because they aim for comprehensive coverage and consistent methods over time. Private measures shine in real time. Together they create a fuller picture. The current gap underscores why public statistics remain central for official decisions, both in the United States and for global investors watching US signals.

What to watch after the CPI print

In the hours after the CPI release market participants will parse the report for whether inflation breadth is broadening or concentrated in specific items. Core measures and shelter components will draw particular scrutiny. Analysts will compare the print with private indicators that had signaled momentum earlier in the month.

Policymakers will use the new information to calibrate discussion at their next meeting. With less frequent official reporting this week the Fed will rely more heavily on the available public series. That makes the September CPI unusually influential for the coming policy deliberations.

For global markets the report will inform expectations on growth and monetary policy in Europe and Asia as well. Many central banks watch US inflation as a reference point for global capital flows and currency moves. The end result is that a single domestic report will have ripple effects across asset classes and borders during the next trading session.

Investors should focus on the data without treating the outcome as a forecast or investment advice. The event highlights the interplay between private innovation in data and the foundational role of public statistics for policy makers and markets.