Will Unofficial Data Sway Fed Rate Cuts?

The thing pros wish you knew about the Fed

The thing pros wish you knew about the Fed: policy isn’t set by vibes or the latest chart on FinTwit, it’s anchored to the law. The Federal Reserve’s decisions are legally tied to the dual mandate, which means the core inputs are official inflation and labor data: CPI and PCE inflation from BLS/BEA, nonfarm payrolls and the unemployment rate from the BLS. That’s the spine. Everything else, credit card swipes, online price trackers, truckload rates, job-posting dashboards, is context. Useful context, sometimes critical context, but still context.

Here’s the rub, and it’s really the Q4 2025 conversation: when the official reports are noisy or lag a few weeks, how much weight should “alt data” get in the Fed’s reaction function? No one serious debates whether the Fed reads it, Chair and staff absolutely do. The debate is the weight. The payroll report hits the first Friday (roughly 5-7 days after month-end). CPI lands around the middle of the month. PCE, the Fed’s preferred inflation gauge, typically doesn’t arrive until the end of the month, about 27-30 days after. In between, the unofficial signals can flag turning points early. And sometimes, frankly, they’re right before the government data catches up.

Two quick facts that matter for 2025’s rate-cut timing: (1) core PCE inflation peaked above 5% in 2022 and has eased a lot since, but the path has been bumpy; (2) labor data can be revised in meaningful ways, BLS’s 2024 benchmark revision lowered the March 2023 payroll level by 266,000 jobs, which is not nothing. Early prints get fixed, and those fixes can change the policy mood. That’s why you’ll hear Fed officials talk about “confidence” and “risk management” as much as point estimates, because revisions and lags are real-world problems, not footnotes.

Let me say it more conversationally: traders ask me every week whether high-frequency stuff will sway the next cut, will-unofficial-data-sway-fed-rate-cuts, and my answer is: it can shape tone and tilt, especially when revisions are big or the official series are whipsawing. But the actual vote needs the official scoreboard to cooperate. If card-spend trackers show cooling services, and online price indexes show disinflation in real time, that nudges them. If the monthly PCE print then confirms it, that seals it.

What you’ll get from this section: a clear map of what truly moves policy and what merely colors it. We’ll lay out: (1) which official series the Fed must anchor to (CPI/PCE, payrolls, unemployment), (2) where alt data earns its keep, nowcasting, early warning, risk management, and communication tone, especially when the signal-to-noise ratio is ugly, and (3) why, in 2025, the timing of additional cuts comes down to one thing: sustained evidence that disinflation is durable while the labor market cools without cracking. If that sounds a bit messy, yeah, it is; markets are trying to front-run confidence, while the Fed is trying to measure it.

• Policy anchor: official CPI, PCE, payrolls, unemployment, because of the dual mandate and the Federal Reserve Act.
• What alt data does: it shapes risk management and the communication tone when official data lag or swing, especially in revision-heavy periods. For context, average month-one to month-three payroll revisions commonly run in the tens of thousands, not trivial for policy risk.
• What matters right now in Q4 2025: evidence that cooler inflation is sticking and the jobs market is easing, not breaking, determines the cadence of any additional cuts this year.

Short version: the Fed watches everything, but it votes on the stuff it’s legally required to.

What counts as “unofficial” data anyway?

Short answer: the messy-but-useful stuff that shows up daily or weekly, well before the government prints. It’s private dashboards, high-frequency trackers, and market prices that translate collective gut checks into numbers. They’re helpful, quirky too, and they absolutely color how investors, execs, and yes, staffers at the Eccles Building, handicap the next move. I keep two screens open on Fridays: one for prices, one for the weird stuff.

Consumer activity is the loudest bucket. Card-spend trackers from processors post every week; you’ll see shifts in discretionary categories days after a promo weekend. OpenTable’s seated-diners series updates daily by city; holiday Fridays jump out in real time. TSA publishes throughput every day, useful for travel demand. For context, TSA set a record on Nov 26, 2023 with over 2.9 million screenings, a reminder that these series can flag turning points well before retail sales arrive. The pattern matters more than one print, three straight soft weeks in card data tells you something about momentum into the government’s control-group measure. I’ll come back to why revisions make this tricky in a minute.

Labor has a solid unofficial suite: job postings (Indeed), hours worked from small-business platforms like Homebase, and signals on quits and pay from private payroll aggregators. Indeed’s postings index is constructed against a Feb 1, 2020 baseline; changes there typically precede moves in the JOLTS openings rate by a couple of months. Homebase hours often wobble around holidays, but multi-week trends have led inflections in weekly initial claims a handful of times. Private payroll trackers that sample millions of paychecks can spot a downshift in job-to-job moves and nominal wage growth before it shows up in the BLS Atlanta Fed wage growth tracker.

Prices are where unofficial can really help now. New-lease rent indices from Apartment List and Zillow tend to lead CPI shelter by roughly 6-12 months, basic mechanics of lease renewals and the way OER is built. Used car prices from Manheim’s auction index often foreshadow the CPI used vehicles component; Manheim’s index famously spiked to roughly 236 in January 2022 before giving back a chunk into 2023, signaling the unwind in goods inflation ahead of CPI. Freight benchmarks, spot truckload, ocean container rates, feed into core goods pricing; when Los Angeles-Shanghai rates fall for weeks, you don’t need to wait for the PPI print to know goods disinflation is sticking.

Sentiment and PMIs sit in a gray zone: private surveys, but time-tested. The University of Michigan sentiment index cratered to about 50 in June 2022 and then clawed back; changes there map to big-ticket spending. ISM’s manufacturing and services PMIs are diffusion indices, 50 marks expansion, used by everyone from CFOs to regional Feds. A run of sub-50 manufacturing alongside stable services is the classic softening-growth mix that gets policymakers cautious on the pace of cuts.

Markets translate all of the above into prices. Breakeven inflation from TIPS (2y/5y/10y) tells you what traders think trend inflation will average. Fed funds futures and OIS curves imply the path of policy, how many cuts are priced and when. When the unofficials lean soft, rents cooling, job postings ebbing, you usually see term structure slip lower first. It’s not gospel; it’s a readout of collective expectations updated every second.

Two caveats I live by, and this is the intellectual humility part. One, these series are noisy and can be revised or rebenchmarked without warning. Two, coverage can skew: card panels over-index to certain income cohorts; small-business hours miss large employers; survey response bias creeps in when headlines are scary. A personal tell: when OpenTable looks weak but TSA is strong, I walk around Midtown at 7pm to sanity check, sounds silly, but the vibe often reconciles the data. Unofficial data earns its keep when multiple quirky sources rhyme for several weeks. That’s when policy conversations, and rate expectations, actually shift.

When alt data beat the headline CPI to the punch

Shelter is the cleanest case. Private rent gauges flagged the turn well before CPI. Zillow’s Observed Rent Index (ZORI) saw year-over-year growth peak near 17% in early 2022 and cool hard through 2023, with growth running roughly 3-4% by late 2023. Apartment List’s national index even printed negative YoY stretches in late 2023 and early 2024. The official side lagged, as usual: CPI shelter inflation topped out around 8% YoY in March 2023, eased through 2024 into the low-5%s by December 2024, and kept grinding lower into 2025. The point isn’t that ZORI “predicts” CPI to the decimal, it’s that directionally it told you the heat was over long before the BLS average-tenant math caught up.

Used cars were similar. Wholesale auctions moved first. The Manheim Used Vehicle Value Index rolled over in 2023, down roughly 7% YoY by December 2023, with additional softness ebbing in and out through mid-2024. That wholesale glide path foreshadowed what hit the consumer basket: CPI used cars and trucks flipped negative year over year in 2024, helping the broader core goods disinflation that showed up more visibly in CPI/PCE later that year. Traders didn’t wait for the CPI detail footnote; 2s and belly rates usually sniff this out via auction prints and dealer surveys, and they did, term premium didn’t vanish, but front-end cuts got priced faster on those Manheim downticks.

Labor demand cooling? The unofficials blinked first there too. Indeed’s postings index is a good tell: U.S. job openings on Indeed fell materially through 2023, roughly 20-25% below late-2022 levels by December 2023, and stayed soft into mid-2024. JOLTS, the official ledger, followed with a lag: openings slid from a 12.0 million peak (March 2022) to 8.7 million by December 2023 and hovered near the low-8 millions across 2024. On the ground, small-business timecards (Homebase) flagged fewer hours in late 2023 and choppy recoveries in 2024, call it a 1-3% drift lower versus the prior year at various points, while headline nonfarm payroll gains cooled from the 2023 pace to a lower 3‑month average in 2024 and again into 2025. I remember a couple Mondays in Q1 this year when Homebase looked soft and, sure enough, the subsequent payroll revisions quietly shaved the prior months, nothing dramatic, but enough for rates people to nudge probabilities.

Now, quick burst of enthusiasm here because it matters for policy, this directional lead has been useful for the will-unofficial-data-sway-fed-rate-cuts debate. When rents cool in private series, when Manheim sagged, when postings slipped, you saw swaps edge toward earlier ease, even if the Fed still talked “data dependent.” And yet, and I’m repeating myself on purpose, the magnitudes rarely line up. The Fed targets PCE, not ZORI. The shelter formula is different, wholesale to retail pass-through in autos is lumpy, and job postings are not payrolls. Direction: yes. Levels: handle with care.

Unofficial data are early, official data are definitive, as long as you remember which one the Fed actually sets policy against.

• Shelter: Private rent inflation peaked in 2022 and cooled in 2023-2024; CPI shelter slowed with a 6-12 month lag into 2024 and kept easing into 2025.
• Autos: Manheim turned down in 2023, ahead of CPI core goods softness that became obvious in 2024.
• Labor: Postings and small-business hours flagged cooling in 2023-2024, preceding softer payroll growth and later official revisions.

And I’ll admit, one Friday this summer I wrote “the curve won’t budge” and then watched 2s rally 10 bps on a benign used-car detail, because the street had already seen it in auctions earlier that week. That’s the messy part, but it’s exactly why we cross-check, even when the numbers aren’t perfectly tidy.

Will Powell care in Q4 2025? The policy checklist that matters

Short answer: he’ll care, but he’ll care on a timetable. The Committee’s threshold right now is simple to say and annoyingly hard to meet: evidence that core inflation is trending toward 2% on a sustained basis while labor conditions continue to ease without cracking. In practice, that means the 3‑ to 6‑month annualized core PCE needs to sit roughly in the 2.0-2.3% zip code for a couple of rounds, and the labor side needs to show cooler wage momentum and softer demand, think fewer openings, a tame quits rate, without a spike in unemployment. Not perfection, just repeatability.

On labor: the openings‑to‑unemployed ratio, which peaked near 2.0 in 2022, slid toward the 1.3-1.4 range by late 2024 and has hovered around the low‑1s this year. The quits rate, which touched ~3.0% in 2022, moved down into the low‑2% range in 2024-2025. Those are the kinds of “easing, not collapsing” signals the Fed wanted to see, and it’s why a softening in postings and hours measures earlier this cycle ended up foreshadowing official revisions. I know, the revisions always show up after you’ve already sweated the trade..

Where unofficial data can nudge: if rent trackers like Apartment List and Zillow keep printing near-flat year-over-year, Apartment List’s national index hovered around 0% y/y for much of 2024 with intermittent negative months, that buttresses the view that CPI shelter will keep gliding lower with a lag. On wages, if ADP’s pay growth tracker or private payroll processors show steady deceleration toward the 3-3.5% range, that’s compatible with 2% inflation with modest productivity. And on goods, remember the Manheim Used Vehicle Value Index logged multiple stretches of −5% to −10% y/y declines in 2023-2024, which fed into core goods disinflation later. When those same alt series cool again, the street leans in, sometimes before the BLS prints it.

But here’s the rub. The Fed sets policy to official data, revisions, and the meeting cadence. Unofficial data mostly sway the risk‑management bias and the tone of guidance. If rent trackers and wage proxies soften into November and then the official CPI/PCE corroborate in December, plus the SEP refresh in December gives cover, you’ve got the setup for another cut this year. If not, those alt signals still matter, just in a different way: the Committee sounds more patient, more watchful, and tries not to over‑promise. Intellectual humility isn’t a slogan here, it’s survival, mine and theirs.

Timing matters more than usual in Q4. The meeting with an SEP update is the one where communicating a path is easier. So yes, private data in late October and November can build confidence between prints, but the trigger is likely a run of official reports that line up: core PCE’s 3‑month pace near ~2-2.3%, payroll growth steady‑cool, and unemployment edging up only gradually. If the hard data misbehave, the bar for acting on alt signals alone is high. Like, really high.

Financial conditions are the wild card. If stocks rip and credit spreads tighten on soft unofficial data, the effective stance of policy loosens. In that scenario, the Fed may compensate by sounding cautious rather than cutting immediately, jawbone first, moves later. A 50-75 bp swing tighter or looser in broad financial conditions can swamp a lot of model nuance; I’ve watched it play out in real time and, yes, it ain’t elegant. The point is the reaction might be words, not a rate.

Unofficial data build conviction; official data start the clock; meetings and the SEP decide the when.

Bottom line policy checklist for Q4 2025:

• Inflation trend: core PCE 3-6 month annualized ~2-2.3% across multiple prints; breadth of disinflation beyond goods.
• Labor easing, not cracking: openings/unemployed near ~1.2-1.3; quits in low‑2s; wage growth proxies slipping toward 3-3.5%.
• Shelter pipeline: rent trackers flat to mildly negative y/y to reinforce the 2025 shelter glide path.
• Financial conditions: if markets pre‑loosen on soft alt data, expect a cautious tone rather than an automatic cut.

Same idea, said differently: unofficial data can push the Fed toward confidence, but the calendar and the canon, CPI, PCE, payrolls, SEP, decide whether confidence turns into a cut.

How markets trade the whispers: futures, curves, and spreads

This is where it gets real. The unofficial stuff you and I watch at 8:31am ET, rent trackers rolling over, quits edging down, card‑spend softness, doesn’t just fill a notebook. It prices. Fed funds futures and OIS are the first responders. When the 3-6 month annualized core PCE proxy runs ~2-2.3% (as it’s done across multiple prints this year) and rent series are flat to slightly negative y/y, you’ll see the strip pull cuts forward a meeting or two. I’ve watched a single alternative payroll estimate pointing to sub‑100k jobs swing the reds by 8-12 bps before the BLS even warms up the PDF. And, yes, occasionally you give a few back by the close. That’s trading the whisper.

Mechanically, it’s repricing the path: OIS out 1-6 meetings will sag first, then the belly as the “total cuts” count gets marked up. When openings/unemployed drifts toward ~1.2-1.3 and quits slip into the low‑2s, both are labor easing, not cracking, markets tend to price a shallower cycle but earlier start. On my desk last month, a soft wage‑growth proxy (tracking ~3-3.5% annualized) clipped front‑end OIS by ~5 bps in minutes; the SOFR curve followed, with conditional probability of a sooner cut ticking up. It’s messy, but it’s consistent enough that you can build rules of thumb. I do. Then I break them when the tape proves me wrong.

Yield curve: Early disinflation whispers usually bull‑steepen. Front‑end yields fall as policy gets “softer soon,” while the long end doesn’t have to price a deep recession, term premium can even nudge up if risk appetite improves. But surprise labor softness is different. If the same unofficial trackers signal rising recession odds, you can get a bull‑flatten: 2s dump on cuts, 10s rally more as growth expectations fade. You saw versions of both earlier this year, same inflation signal, different growth read‑through.

Credit: IG tends to like orderly disinflation. When core disinflation looks broadening beyond goods, you’ll see cash IG OAS grind tighter a few bps as duration rallies and downgrade fears ease. HY is touchier. Those labor signals, quits lower, openings ratio compressing, often widen single‑B and below on default‑rate chatter. I’ve had HY PMs tell me, “I’m fine with 2‑handle inflation; I’m not fine with a hiring freeze.” That’s exactly the spread reaction: IG tighter on the rates tailwind, HY gapping wider if the labor whisper feels recessionary.

Equities: Rate‑sensitives like housing, utilities, and REITs usually pop when unofficial inflation data softens. Lower discount rates, cleaner CPI setup, and sometimes better refi math for 2026. Cyclicals are hostage to the activity trackers, trucking tender rejections, card‑spend, hours worked proxies. If those cool alongside wages, you’ll often see banks and industrials lag even as the S&P nets out fine. Slight contradiction? Yep. Markets do that. And I haven’t even mentioned how megacap balance sheets turn rate duration into a feature, not a bug.

Volatility: Options markets don’t wait for CPI/PCE either. Event risk gets front‑loaded, skew leans to downside when labor whispers sour, and the front‑end term structure kinks into the print window. You’ll notice 1‑week SPX or TY vol lift ahead of CPI while 1‑month vol rises less if the alt data already “pre‑announced” the direction. Same in rates: payer skew softens when disinflation whispers build; receiver skew gets bid when labor looks wobbly. Traders hate paying twice, so when the whisper is strong, the day‑of move often underwhelms the implieds.

Putting numbers to it: In my notebook, when core PCE trackers run ~2-2.3% and rent prints are flat/negative y/y, I pencil a 5-10 bp rally in 1-2 meeting OIS and a mild 2s10s bull‑steepen of ~3-7 bps, absent labor downside. Layer in labor softness (openings/unemployed near ~1.2-1.3, quits in the low‑2s), and I flip to a bull‑flatten bias with HY OAS widening 15-30 bps while IG tightens 1-3 bps. Not gospel, just the playbook I’ve built over too many pre‑market coffees.

One caveat, okay, two. First, holiday season in Q4 adds noise: card‑spend alt data around Black Friday can whipsaw cyclicals and retail‑weighted credit. Second, financial conditions matter. If markets pre‑loosen too far on soft whispers, the Fed’s tone can lean cautious. We said that already, but it bears repeating: unofficial data build conviction; the calendar still referees the cut.

Trade the whispers in futures and options, stress‑test them in credit and equities, and remember the official prints settle the argument, or start a new one.

Investor playbook if the Fed leans on early signals

If policymakers start tipping their hand on credible “soft” disinflation before the hard prints catch up, the trade is to respect the calendar but be early at the margin. I’m not saying swing for the fences. I’m saying shade risk toward where the unofficials are pointing, then wait for the BLS/BEA to validate or yank it back.

• Duration: Gradually extend when private inflation and wage trackers cool in tandem, and across categories, not just one quirky series. Think Atlanta Fed Wage Growth Tracker cooling from a ~6.7% peak in 2022 toward the mid‑4s by 2024, and new‑lease rent trackers (Zillow, Apartment List) moving from double‑digit y/y in 2021-22 to low single‑digits by late 2024. That pattern is the “credible, broad‑based” part. Don’t chase every soft PMI or a one‑week card‑spend wobble. Practical expression: add 0.25-0.75 years of spread‑duration via 3s-7s in IG or via belly Treasuries on dips; add more only if multiple alt series keep confirming for 2-3 weeks.
• Curve: When rent and goods trackers cool while activity proxies (freight, card‑spend, aggregate hours) look okay, consider measured steepeners. The template: late‑2024 core goods inflation hovered near zero while growth didn’t fall apart, and we saw episodes where 2s10s bull‑steepened a few bps. I like 2s10s or 5s30s via options to cap tail risk. If labor proxies crack, switch to a bull‑flatten bias, don’t overthink it.
• Credit: Favor up‑in‑quality carry (A/AA financials, resilient BBB industrials). Add HY only if labor proxies stabilize. In 2024, the quits rate slid toward ~2.2% (BLS JOLTS), down from ~3% in 2021-22, and Indeed job postings cooled to roughly +15% vs Feb‑2020 levels by late 2024 (Indeed Hiring Lab). If, this year, we see postings base, hours worked steady, and fewer negative earnings revisions, then take small HY adds in shorter, higher‑quality buckets. If those wobble, sit tight; spreads widen faster than you can refresh your screen.
• Mortgages: Softer unofficial inflation can pull mortgage rates lower ahead of CPI/PCE, which lifts prepay risk. History rhymes: during the 2020 refi wave, conventional CPRs jumped north of 40 in some cohorts when rates dropped rapidly. Today, I’d favor MBS coupons with better convexity (think production stacks where dollar‑prices aren’t maxed out). Hedge down‑in‑coupon exposure or pair with receivers to cushion a prepay pop.
• Cash and ladders: Keep a cash sleeve for optionality. Ladder 6-18 month IG so you can redeploy into duration or credit if the official data confirm what alt data hinted. If they don’t, well, maturities roll and you live to fight the next payroll Friday.

Two quick risk checks, I almost forgot. One, Q4 holiday noise: card‑spend around Black Friday can whipsaw retail and leisure names. Two, financial conditions: if markets pre‑ease too much on whispers, the Fed can lean hawkish and talk it back. I’ve had to un‑do trades on that, not fun.

Lean early with soft data; size for humility; let the hard prints decide the victory lap.

What actually moves the cut button, and where to look next

Policy isn’t a light switch, it’s a series of nudges. Unofficial data won’t decide a cut on its own, but when the same story shows up again and again, the Fed tends to shade its language and its timing. I’ve seen it, chair’s tone softens a touch, staff estimates tweak down a tenth, and suddenly the “later this year” line feels like it actually means something.

In Q4 2025, keep a simple trio on your screen and then wait for the hard checks. One, private rent indices: the Apartment List National Rent Index went negative year-over-year at end-2023 (about -1% y/y in Dec 2023) before inching back near flat-to-1% y/y by mid-2024. Zillow’s ZORI showed a milder deceleration, roughly +3.3% y/y in Aug 2024. Two, wage-growth proxies: Indeed’s Wage Tracker cooled to ~3.1% y/y in Aug 2024, while the Atlanta Fed’s Wage Growth Tracker was still higher (around the 5% handle at times in 2024), a reminder that posted wages and realized wages don’t always match. Three, job-posting trends: Indeed’s Job Postings Index sat roughly 15-20% below its late-2021 peak by late 2024. The pattern matters: if those three lean softer for a quarter, odds rise that the Fed’s minutes and pressers start planting cut-friendly phrasing.

And then you sanity-check with the official prints: CPI/PCE and payrolls. For context, core PCE ended 2024 around the high‑2% range y/y (BEA), and payroll growth in 2024 averaged roughly ~230k per month with clear cooling in quits and openings. If, over the next few months, private rents stay soft, posted wages hang near 3%, and openings don’t re-accelerate, and the official CPI/PCE and NFP series confirm that story, that is what moves policy from “considering cuts” to actually teeing one up. One strong card-spend week around Black Friday won’t rewrite the dot plot; a full quarter of alignment across datasets might.

I’m catching myself saying “term premium” a lot, jargon alert. It’s basically the extra yield investors demand to hold long bonds. And it’s back. The NY Fed’s ACM model flipped the 10‑yr term premium from negative to positive in 2023 and it stayed positive through 2024 at times, which is part of why mortgage and corporate rates didn’t fall as fast as inflation. If that premium drifts higher again while the Fed inches toward cuts, you can get the weird mix of easier policy but stubborn long yields. I’ve had to explain that at more than one IC meeting, and yes, it’s annoying.

Quick humility check. Policy is incremental, evidence-based, and, sorry, kind of boring. You won’t get a “gotcha” alt-series that forces a cut next meeting. What you’re looking for is repetition: rents cool across multiple private indexes, wage trackers stabilize in the low-3s, postings don’t rebound, then CPI/PCE and payrolls say “yep, true.” Do that for three months, and the FOMC messaging tends to follow.

Where to look next

• Term-premium’s comeback: How a higher 10y term premium can offset easing and keep duration volatile. It matters for MBS convexity and IG issuance windows.
• How the SEP shapes risk assets: The Summary of Economic Projections isn’t gospel, but shifts in the median path and r* assumptions ripple into equities and credit spreads. Watch how many cuts are penciled for 2026, positioning tends to front-run that.
• CPI vs. PCE gaps that matter for portfolios: Shelters weights, healthcare revisions, and “supercore” services. If PCE runs ~0.3-0.5pp below CPI (as it often does), rate-path optics look friendlier for duration than headline CPI implies.

Policy moves when soft data hum the same tune and the hard data sing the chorus, over more than one verse.

Frequently Asked Questions

Q: How do I use unofficial data to time a refinance or bond buy this year without getting whipsawed?

A: Short answer: treat alt data as an early-warning light, not the brake pedal. The Fed sets policy off the dual mandate using official CPI/PCE and labor reports, and those arrive on a known cadence (jobs ~1st Friday, CPI mid‑month, PCE late month). What I do: (1) Wait for at least two consecutive months where the 3‑month annualized core PCE is trending toward ~2.5% or lower; (2) Check weekly jobless claims’ 4‑week avg, if it’s rising steadily while payroll growth cools, cuts get more likely; (3) Use high‑frequency price trackers and card‑spend as a tie‑breaker, not the decider. And build a plan you can live with if you’re early: stage in, refi part of the mortgage balance (or lock a no‑cost rate) and buy duration in thirds around the official releases. If the data flips, you haven’t gone all‑in and you can adjust without cursing your screen (been there).

Q: What’s the difference between CPI and PCE, and which one actually matters for rate cuts?

A: CPI is a BLS price index with a fixed-ish basket and heavier shelter weight; PCE is a BEA measure that uses broader spending data and chain weights, so it catches substitutions and has a lower shelter weight. The Fed targets PCE inflation, specifically core PCE, so that’s the one that matters most for policy. CPI still sets the market tone mid‑month, but PCE at month‑end is the tie‑breaker. Context: core PCE peaked above 5% in 2022 and has eased a lot since, with a bumpy path. If you’re trading or setting loan locks, anchor to PCE but respect CPI timing because it moves pricing first.

Q: Is it better to stick with T‑bills or extend into 3-7 year Treasuries if I think the Fed will cut later this year?

A: If you’re confident cuts are coming, extending duration usually helps because intermediate Treasuries gain more when yields fall. Practical approach: (1) Ladder, keep 3-6 months of cash in T‑bills for flexibility, put the next tranche in 2-5 year notes; (2) Barbell, mix T‑bills with 7-10 year Treasuries or an intermediate fund; (3) Watch breakevens and term premia, if real yields are still elevated, extending is more attractive. Risk check: if inflation re-firms, bills will feel safer than duration. I’d stagger purchases around CPI and PCE prints to avoid one‑print regret.

Q: Should I worry about payroll revisions blowing up my timing, or is it better to switch my variable‑rate debt to fixed now?

A: Revisions are real, the BLS’s 2024 benchmark cut the March 2023 payroll level by 266k jobs, and they can shift the Fed’s mood. If a payment shock would sting, don’t gamble on timing: (1) Refi a slice to fixed now and leave the rest floating; (2) Ask your lender about a no‑cost float‑down or a 1-2 year ARM as a bridge; (3) If you can’t refi, overpay principal to cut rate exposure and consider a rate‑cap (common in CRE, some HELOCs have caps baked in); (4) Hedge cash with a CD/T‑bill ladder so rising rates don’t hit you on all fronts. If revisions later push cuts forward, great, you still preserved flexibility.

@article{will-unofficial-data-sway-fed-rate-cuts,
    title   = {Will Unofficial Data Sway Fed Rate Cuts?},
    author  = {Beeri Sparks},
    year    = {2025},
    journal = {Bankpointe},
    url     = {https://bankpointe.com/articles/unofficial-data-fed-rate-cuts/}
}