Fed’s Goolsbee Explores Inflation Risks Impacting Rate Cuts

• Lyla Velez
• September 30, 2025
• Policy
• 0 Comments

Austan Goolsbee, President of the Chicago Fed, has highlighted potential inflation risks and a possible U.S. government shutdown impacting future Federal Reserve rate cuts. These developments may disrupt essential economic data evaluations.

Goolsbee’s concerns underline the importance of reliable economic data during crucial decision-making periods. The current situation has market watchers anticipating increased volatility, particularly in cryptocurrency markets, pending government data’s availability.

Austan Goolsbee, President of the Federal Reserve Bank of Chicago, addressed inflation concerns and potential U.S. government shutdown effects on the Fed’s ability to discern necessary monetary policy adjustments. His comments align with recent Federal Reserve policies emphasizing data-driven decisions.

“A government funding lapse would suspend government data publication at a time when the Federal Reserve is watching data carefully to decide on further rate cuts.” – Austan D. Goolsbee, President, Federal Reserve Bank of Chicago.

Primary stakeholders include Goolsbee, as a Federal Open Market Committee (FOMC) member, alongside other Fed figures like Jerome Powell. The recent FOMC meeting resulted in a 0.25% rate cut, while future reductions remain contingent on incoming data, underscoring the growing importance of economic reports unimpeded by government actions.

Concerns extend to immediate market reactions. Major cryptocurrencies such as BTC and ETH may face heightened volatility. Risk aversion among investors often promotes temporary shifts toward U.S. Treasuries or stablecoins, reflecting market hesitance amidst data uncertainty.

Implications of such economic scenarios bear significance on Federal Reserve decisions and broader policy strategies. Goolsbee’s warnings illustrate the potentially amplified impacts on both financial markets and Federal Reserve policies, demanding vigilant evaluation of economic conditions against the backdrop of potential data disruptions.

Historical analysis reveals similar scenarios equating to market unease and temporary shifts in investor strategies. Prior U.S. government shutdowns provide context whereby equities and crypto markets experience turbulence, often prompting increased trading in stable, predictable assets as markets adjust to policy announcements.