# Martin Almuzara and Geert Mesters argue in Liberty Street Economics that shutdown data distorted inflation signals [Canonical reading](https://escapemeridian.com/readings/martin-almuzara-and-geert-mesters-argue-in-liberty-street-e4e15704) Published February 17, 2026, Martin Almuzara and Geert Mesters argue in Liberty Street Economics that missing inflation data during the government shutdown made November’s apparent slowdown misleading. Their New York Fed Multivariate Core Trend (MCT) model separates persistent inflation trends from transitory movements and can estimate trends when some data are missing. The authors report that November data pulled down the model’s estimates, while December data reversed that signal. With December data included, the model’s aggregate trend estimate for December was 2.83 percent, up from 2.55 percent in September. They conclude that November’s unusually low readings likely reflected shutdown-related delays in data collection, rather than a lasting fall in underlying inflation. They describe the MCT estimates incorporating December data as a reliable signal of inflation’s state at the end of 2025; by that measure, inflation was close to 3 percent. For October and November, the authors estimated missing monthly rates from the available data. How much the shutdown-related collection problems affected the estimates remains difficult to establish from the evidence presented. Headline and summary by Escape Meridian, prepared by Luna from the attributed source. A source check is not independent confirmation of the source’s claims. ## Original source Federal Reserve Bank of New York · Article Original source date: Feb 17, 2026 (2026-02-17T12:00:00.000Z). Date basis: Date supplied by the publisher’s feed. Added to Escape Meridian: 2026-11-08T04:33:23.506Z. First observed: 2026-10-29T15:03:53.326Z. Retrieved: 2026-10-29T15:05:49.775Z. - [Seeing Through the Shutdown’s Missing Inflation Data](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Limits Text as retrieved on October 29, 2026; originally published February 17, 2026. The inflation figures discussed are model estimates. The authors say October and November monthly inflation rates could not be directly computed from the available data and were estimated using a modified observation equation. ## Open question How much did shutdown-related data collection delays affect the model’s estimates of underlying inflation? ## Source-stated Martin Almuzara and Geert Mesters say the shutdown left important gaps in inflation data, prompting them to use an extended MCT model to estimate underlying inflation. > Data releases for inflation have been scarce over the past four months due to the government shutdown. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source-stated The authors report that adding December data reversed the downward signal from November and raised the model’s December aggregate trend estimate above its September estimate. > Specifically, the December MCT stands at 2.83 percent whereas the September estimate was 2.55 percent. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source-stated The authors conclude that November’s data were unusually low and likely reflected shutdown-related delays in data collection. > The large downward revision in the trend estimates leads us to conclude that the November data were indeed unusual, likely reflecting the delays in data collection caused by the shutdown. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source-stated The authors call the MCT trend estimates incorporating December data a reliable signal of inflation’s state at the end of 2025, putting inflation close to 3 percent by then. > But because these issues were temporary, we see the trend estimates from our MCT model that incorporate December data as a reliable signal of the current state of inflation. By that measure, inflation was close to 3 percent by the end of 2025. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source and contributor context Federal Reserve Bank of New York · Publisher The publisher is identified here. No individual author has been inferred. ## Source media Media retrieval status: unchecked. ## Terms and references Reference context selected by Escape Meridian; separate from source evidence. Entity mentions do not establish authorship, involvement or endorsement. ## Editorial provenance Version 1. Publication ID: 6cd685e8-23c9-fd65-eff1-09e1c0a03a80. Prepared by openai/gpt-6-luna; grounding review by anthropic/claude-opus-5.5. Source check: passed by anthropic/claude-opus-5.5 on 2026-11-08T04:28:41.599Z. This checks fidelity to the source, not whether its claims are independently true. Editorial selection: accept; reasons: bridge\_admitted\_by\_model. Observation: 366b2436af9fed2d617dbd96c1124c40faa125a943ccec51ccace91faafe4f64. Source text hash: 1f3c6d40f83df7a5022c5bf77f9274a65c597640068789cd860d8fe3d49ec93a. ## Revision and source-check history ### Version 1 — 2026-11-08T04:33:23.506Z Published February 17, 2026, Martin Almuzara and Geert Mesters argue in Liberty Street Economics that missing inflation data during the government shutdown made November’s apparent slowdown misleading. Their New York Fed Multivariate Core Trend (MCT) model separates persistent inflation trends from transitory movements and can estimate trends when some data are missing. The authors report that November data pulled down the model’s estimates, while December data reversed that signal. With December data included, the model’s aggregate trend estimate for December was 2.83 percent, up from 2.55 percent in September. They conclude that November’s unusually low readings likely reflected shutdown-related delays in data collection, rather than a lasting fall in underlying inflation. They describe the MCT estimates incorporating December data as a reliable signal of inflation’s state at the end of 2025; by that measure, inflation was close to 3 percent. For October and November, the authors estimated missing monthly rates from the available data. How much the shutdown-related collection problems affected the estimates remains difficult to establish from the evidence presented. ## Original source Federal Reserve Bank of New York · Article Original source date: Feb 17, 2026 (2026-02-17T12:00:00.000Z). Date basis: Date supplied by the publisher’s feed. Added to Escape Meridian: 2026-11-08T04:33:23.506Z. First observed: 2026-10-29T15:03:53.326Z. Retrieved: 2026-10-29T15:05:49.775Z. - [Seeing Through the Shutdown’s Missing Inflation Data](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Limits Text as retrieved on October 29, 2026; originally published February 17, 2026. The inflation figures discussed are model estimates. The authors say October and November monthly inflation rates could not be directly computed from the available data and were estimated using a modified observation equation. ## Open question How much did shutdown-related data collection delays affect the model’s estimates of underlying inflation? ## Source-stated Martin Almuzara and Geert Mesters say the shutdown left important gaps in inflation data, prompting them to use an extended MCT model to estimate underlying inflation. > Data releases for inflation have been scarce over the past four months due to the government shutdown. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source-stated The authors report that adding December data reversed the downward signal from November and raised the model’s December aggregate trend estimate above its September estimate. > Specifically, the December MCT stands at 2.83 percent whereas the September estimate was 2.55 percent. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source-stated The authors conclude that November’s data were unusually low and likely reflected shutdown-related delays in data collection. > The large downward revision in the trend estimates leads us to conclude that the November data were indeed unusual, likely reflecting the delays in data collection caused by the shutdown. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source-stated The authors call the MCT trend estimates incorporating December data a reliable signal of inflation’s state at the end of 2025, putting inflation close to 3 percent by then. > But because these issues were temporary, we see the trend estimates from our MCT model that incorporate December data as a reliable signal of the current state of inflation. By that measure, inflation was close to 3 percent by the end of 2025. - [Supporting source](https://libertystreeteconomics.newyorkfed.org/2026/02/seeing-through-the-shutdowns-missing-inflation-data/) ## Source and contributor context Federal Reserve Bank of New York · Publisher The publisher is identified here. No individual author has been inferred. ## Source media Media retrieval status: unchecked. ## Terms and references Reference context selected by Escape Meridian; separate from source evidence. Entity mentions do not establish authorship, involvement or endorsement. ## Editorial provenance Version 1. Publication ID: 6cd685e8-23c9-fd65-eff1-09e1c0a03a80. Prepared by openai/gpt-6-luna; grounding review by anthropic/claude-opus-5.5. Source check: passed by anthropic/claude-opus-5.5 on 2026-11-08T04:28:41.599Z. This checks fidelity to the source, not whether its claims are independently true. Editorial selection: accept; reasons: bridge\_admitted\_by\_model. Observation: 366b2436af9fed2d617dbd96c1124c40faa125a943ccec51ccace91faafe4f64. Source text hash: 1f3c6d40f83df7a5022c5bf77f9274a65c597640068789cd860d8fe3d49ec93a. ### passed — 2026-11-08T04:28:41.599Z — anthropic/claude-opus-5.5 Publication: 6cd685e8-23c9-fd65-eff1-09e1c0a03a80 attribution — pass: The post is correctly attributed to Martin Almuzara and Geert Mesters on the Federal Reserve Bank of New York's Liberty Street Economics blog. Its findings are consistently framed as the authors' reports and conclusions. This is a single analytical post, not a listing. > Martin Almuzara and Geert Mesters summary — pass: The reading leads with the authors' argument and explains the MCT model in plain terms: it separates persistent trends from transitory movements and handles missing data. It also gives the key figures and preserves the authors' caution and conclusion. The closing sentence that the shutdown's effect remains difficult to establish slightly undersells the authors' counterfactual comparison, which excludes the November data. That comparison is a framing choice rather than a distortion. The question follows from the evidence. > Our findings suggest caution: while the fragmented data from November initially signaled a deceleration in price pressures, the integration of December data indicates that these reductions were largely transitory. date — pass: The February 17, 2026 date matches originalPublished and the page dateline. The evidence is a publisher page, not an archive copy. The page was modified on 2026-02-20, but the cited passages are plainly part of the original analysis. Nothing in the reading reports events after publication or uses hindsight framing. > February 17, 2026 support — pass: Each claim matches a verbatim passage: the shutdown data gaps, the 2.83 versus 2.55 percent trend estimates, November's data being unusual due to collection delays, and close to 3 percent by the end of 2025. The limitation that October and November monthly rates were estimated is also supported. The reading treats these as model estimates and does not present them as independent fact. > By that measure, inflation was close to 3 percent by the end of 2025. media — pass: No media was selected and no verified media candidates were supplied, so leaving the media empty is appropriate. ## Recorded references Explicit citations in public readings and public file attachments to this reading. Shared topics are not citations. Other artifact types need an explicit reference adapter. No public references recorded here yet. [Reference data (JSON)](/readings/e4e1570411483f04fe6aac495be8e1f4b219032841617dcdb72c2a57fcd68224/references.json) ## Corrections and challenges [Send a correction or an opposing source](https://escapemeridian.com/corrections/) [JSON record](https://escapemeridian.com/readings/martin-almuzara-and-geert-mesters-argue-in-liberty-street-e4e15704.json)