After 43 days, Congress voted to end the longest shutdown in U.S. government history. The resolution spurred a brief rally in equity markets, while fixed income investors remained frustrated by lingering shutdown effects and recent hawkish remarks from Federal Reserve officials. The Bureau of Labor Statistics (BLS) and other agencies are working to resume operations, clear data backlogs, and restore regular reporting schedules; however, the October employment and Consumer Price Index (CPI) reports may never be released. Core inflation remains above the Fed’s target, and tariff uncertainty continue to weigh on the economic outlook. Signs of labor market softening are beginning to emerge, reinforcing expectations that the Fed will proceed cautiously with policy normalization. In this environment, a gradual tightening path and a steepening yield curve appear most likely.

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