US Government Shutdown and Growing Troubles in Economy

The ongoing US government shutdown is causing major disruptions in the country’s economy. The latest job cut report for October, released by Challenger, Gray & Christmas, showed a staggering 153,000 layoffs, the highest number since 2003. The report cited factors such as softening consumer demand, the shutdown, adoption of artificial intelligence, and higher tariff-taxes as the main drivers behind this trend. In fact, this year alone, there have been over 1 million people laid off, according to the survey. This has resulted in a significant slowdown in hiring activity, with the last time the situation being this bad being during the first term of the Trump presidency, when there was still an excuse for it. However, this time, it is all due to the policies implemented by the current administration.

The New York Federal Reserve’s Global Supply Chain Pressure Index has also shown a decline, indicating a drop in US consumer demand. This has caused the financial markets to become more risk-averse, resulting in a negative impact on commodity currencies.

FAA Shutdown and its Impact on Air Travel

Adding to the already dire situation, the Federal Aviation Administration (FAA) has announced restrictions on air traffic control services at many airports due to the shutdown. The FAA stated that they are unable to pay controllers and as a result, can only roster a limited number of them due to safety concerns. Interestingly, the cutbacks will mainly affect states with Democratic governors, adding a political spin to the situation. As a result, a large number of flights have been cancelled, causing further disruptions to the already struggling economy.

US Adds Ten Minerals to Critical Minerals List

In the midst of all this chaos, the US has recently added ten minerals to its Critical Minerals List, which could potentially lead to trade restrictions and tariffs under Section 232. This move is seen as a way to pressure their trading partners and provide cover for investors who support the re-opening of unprofitable US capacity.

Canada’s Unconventional Budget and China’s Rising Inflation

In contrast, Canada has released its budget for 2025, taking an unconventional approach by focusing on a long-term economic shift away from US dependence rather than short-term benefits. This strategy may cause political tensions in the short term, but it is similar to the approach taken by China. The governor of the Bank of England, Mark Carney, is confident that the Canadian public will have the patience to see the long-term benefits of this plan. However, the opposition views this as an opportunity to gain political advantage.

On the other side of the Pacific, Taiwan’s inflation has risen from a low of 1. 3% in September to 1. 5% in October, a level that has remained consistent for the past four months.

Central Bank Rate Decisions and Retail Sales in EU

Three central banks, including Malaysia, Norway, and England, have announced their decisions to hold rates unchanged.