11/10/25 REcap: Is the Government Shutdown Finally Ending?

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Senate Strikes Bipartisan Deal to End Shutdown

The Senate took a major step toward ending the longest government shutdown in history, advancing a temporary funding measure with bipartisan support—including votes from 8 Democrats—to reopen federal agencies and restore worker pay. The stopgap bill would keep the government funded until January 30th while longer-term budget negotiations, especially those surrounding the Affordable Care Act, continue. With both parties under pressure from business leaders and the public over the shutdown’s growing economic fallout, the measure now heads to the House, where swift approval is expected before President Trump signs it into law. Remember, this bill still needs to go to the House for a vote before getting sign off by Trump, so it's by no means a sure thing.

For mortgage rates, the government shutdown ending is news we've been waiting for.  At the October 29th meeting, Fed Chair Jerome Powell emphasized that any future cuts would depend entirely on incoming data — particularly labor and inflation reports — but with the shutdown halting key government releases, the Fed has been forced to rely on private data and secondary indicators (not great). Powell said the Fed needs to “see more good data” before easing again, acknowledging that policymakers can’t judge whether the economy is softening fast enough to warrant another cut without those official figures. Mortgage rates have been ticking higher as the shutdown continues because the Fed might pause until it has a clearer economic picture. For homebuyers, that means short-term rate volatility, but continued downward pressure over the longer term — assuming upcoming data confirms that job growth and inflation are cooling once reports resume.

The Jobs Data We Did Get

With the government still shut down, October’s official jobs report wasn’t released, leaving economists to piece together a picture of a slowing but resilient labor market. Economists surveyed by Dow Jones suggest payrolls fell by roughly 60,000 and unemployment rose to 4.5%, reflecting weak hiring rather than mass layoffs. The ISM services index climbed to an eight-month high at 52.4, signaling steady business activity, but its employment gauge declined for a 5th straight month. Tariffs and the shutdown weighed heavily on confidence, and Challenger, Gray & Christmas reported the most October job cuts in 22 years, underscoring caution across sectors.

ADP’s private payroll report — one of the only data sources available — showed employers added just 42,000 jobs in October, with strength in trade and health care offset by losses in manufacturing and hospitality. It's higher than the 22,000 expected but ADP is not the most reliable source of data. Pay growth was flat, and small businesses continued to shed workers, while large firms added staff. The report reinforced the view of a cooling but not collapsing labor market. 

Looking Ahead: What will happen if the Government Reopens?

If we see the government reopen (and that's still a big if), we should see a flurry of labor data follow shortly thereafter. If the bill can move through quickly, we may even see some critical inflation data that's currently scheduled for release on Thursday and Friday this week.

There's currently just a 65% chance that the Federal Reserve will cut rates next month (down from 70% last week), and that's still largely due to the lack of data we've seen since the shutdown started. 

Remember - it's not necessarily what the Fed does that moves rates, but what the market believes the Fed will do. Right now, there's no telling what the Fed's next move will be.