U.S. Economics – Alternative Data

Intro

With the U.S. Government shutdown in effect, key economic indicators we monitor are no longer being released. Prediction markets like Polymarket and Kalshi can offer a view into how long these market participants believe the shutdown will last. Between now and the end of the shutdown, we can track alternative data to provide some insight into the most likely trajectory of the important data, like retail sales, inflation, and jobs.

The Signals:

• • Polymarket/Kalshi
    • How many days will the federal government be shut down in 2025?
      • Polymarket’s market is currently showing a 69% that the shutdown lasts between 10-29 days and a 28% chance that it lasts 30+ days.
    • How long will the government shutdown last?
      • Kalshi’s market is currently showing a 61% chance that the shutdown lasts more than 20 days and a 48% chance that it lasts more than 25 days.
  • Redbook Weekly Retail Sales
    • Like most of this alternative data, the level of growth does not always have to line up – we are focused on the direction and magnitude of changes over recent periods.
      • The Redbook measure of retail sales has been on a positive trajectory for the last eighteen months and has maintained that healthy pace in recent weeks.
      • This should be a positive for the consumer spending component that feeds into GDP calculations.
  • ISM PMI Prices
    • For a gauge on producer prices, which oftentimes make their way into consumer prices, we can track price surveys from the Institute for Supply Management Purchasing Managers’ Index (ISM PMI) across manufacturing and services sectors.
      • A measure above 50 indicates expansion, or higher prices, for PMI price data.
      • Manufacturing and services prices have been in the 60s for nearly all of 2025.
      • This adds to our outlook for continued, above-FOMC-target inflation.
  • Indeed Job Postings/Challenger Job Cuts
    • We have already missed September’s nonfarm payrolls report and initial jobless claims data, but alternative data suggests the setup for both measures is unlikely to change soon.
      • Indeed new job postings have largely followed the same path as nonfarm payroll growth on a monthly basis since the end of 2022.
      • Challenger job cuts have been more volatile than initial jobless claims and are generally more prone to significant distortions coming from a specific sector, like Technology in 2023 or the Federal government more recently.
      • This provides further evidence that we remain in a low hiring, low firing environment that has defined most of the last two to three years.

Key Takeaways:

• While we are in the dark on official government data, there are plenty of alternative data sources that largely follow a similar path as their government counterpart.

Visuals:

Source:Kalshi,Polymarket   

Source: Macrobond

Market Trends:

Source: Macrobond

The views expressed herein are presented for informational purposes only and are not intended as a recommendation to invest in any particular asset class or security or as a promise of future performance.  The information, opinions, and views contained herein are current only as of the date hereof and are subject to change at any time without prior notice.