For the second month in a row, the Federal Reserve has cut interest rates. This move was expected, but the Fed chair is now warning that there might not be a third drop when they meet again in December. A big part of his hesitancy stems from the fact that the Fed is now essentially flying blind, because the government shutdown has caused the flow of economic data to halt. Jerome Powell used a different transportation-based metaphor to describe this, saying: "If there is a high level of uncertainty, then that could be an argument in favor of caution about moving.... What do you do if you are driving in the fog? You slow down. I'm not committing to that. I'm just saying it's certainly a possibility that you would say, 'We really can't see. So let's slow down.'"

The government shut down at the beginning of October. This meant that the jobs report for September was not published. Worse, it also means that new data has not been collected all month long, which may make it impossible to even calculate the jobs numbers for this month. If the shutdown persists into November, it could be early January before these numbers start flowing once again. That's a big gap, obviously. And it's not just the jobs numbers -- the inflation rate is also put out by the same agency:

Typically, the Fed cues off the incoming official data to help justify its interest-rate decisions, while also citing alternative measures and surveys related to economic activity. But the shutdown has effectively created a data blackout for the Fed, at least from government sources. The Bureau of Labor Statistics released the Consumer Price Index report for September over a week late, on Friday, in order to meet a deadline for Social Security cost-of-living adjustments. But that is likely to be the last major data release from the agency for a while.

The White House recently warned that the C.P.I. report for October might not be published since data for the month was not being collected given the shutdown. September’s job report and all subsequent monthly releases have also been indefinitely delayed.

It's the Fed's job to try to influence both of these economic indicators. They're supposed to keep inflation down to two percent and the unemployment rate as low as possible. However, these two goals are in tension (if not conflict) with each other. The Fed's one big bit of leverage over the economy is setting interest rates, which it raises when inflation gets too high and lowers when the unemployment number goes up. But we are in a period where both may be happening simultaneously -- higher inflation and a weaker jobs market. This is the dreaded "stagflation," and the Fed obviously can't both raise and lower interest rates at the same time, so they wind up having to choose one battle to fight at the expense of the other.

Right now, they're trying to improve the jobs market. For the last few months (of available data), the jobs numbers have been pretty unimpressive. And inflation is going up, but slower than some expected (it now stands at three percent).

But remember -- they're driving in the fog now. There are no jobs numbers for September and there won't be any for October. Unless the government opens soon, the data for November won't be collected either, for either the jobs market or the inflation rate.

Obviously, this leads to the danger that things are happening out there in the economy that nobody realizes right now. Large layoffs have been announced at multiple big corporations (Amazon, UPS, etc.), but so far this is just anecdotal -- it might not be indicative of what the larger economy is doing. By the time any larger trends do become evident in hard data, the Fed might have moved in the wrong direction, which would only serve to exacerbate the problem. Adding to this mix is the economic impact of the shutdown itself -- which is being guessed at, but has not adequately been quantified.

The Fed does have private data and its own regional measures to work with, but the official government numbers are what they normally base their decisions on. Without those numbers, the Fed could easily decide to do nothing for the time being, which is what Powell warned about today:

At this meeting, there were strongly differing views about how to proceed. A further reduction in the policy rate at the December meeting is not a foregone conclusion. Far from it. Policy is not on a preset course. And, the takeaway from that is that we haven’t made a decision about December.

Doing nothing (the conventional wisdom says) at least won't make the problem worse. But there are two problems, and nobody knows whether they're both getting worse, getting better, or perhaps moving in different directions.

The government shutdown will (assumably) end, at some point. The Bureau of Labor Statistics will start collecting data again and publishing monthly official numbers on unemployment and inflation. There might be a gap in the continuity of such data, but we'll all adjust when the new numbers begin appearing. The fog will lift, and the Fed will be able to move with much more confidence (no matter what it winds up doing). But there might be a bigger fog bank out there in the future.

When the official government numbers do eventually start appearing again, they will be trusted -- for the time being, at the least. But that may not always be true.

Remember, Donald Trump fired the head of the B.L.S. after a bad jobs report was released, and then nominated an complete ideologue to run the bureau. But the Senate balked, and his nomination was withdrawn. This has left the bureau, for the time being, in the hands of a career statistician who people still trust not to let politics influence the data-crunching. But that could all change if Trump gets around to appointing another B.L.S. leader who does make it through Senate confirmation. If people (and the Fed) can't trust the numbers coming out of the bureau after that, then the danger is that we'll all be driving in the fog for the foreseeable future.

Notably, though, the Senate has already balked once. This means that at least four Republicans said they wouldn't support Trump's nominee. This shows an impressive amount of independence, because up until now the Republican Senate has largely been a rubber stamp when it comes to confirming anyone Trump nominates to anything, no matter how laughably unqualified they are (case in point: R.F.K. Jr.). For them to refuse Trump's first pick to run the B.L.S. might send a message that this job is too important for just anybody to hold. One hopes that this is true, because while a multi-month gap in data is a temporary problem that can be adjusted for (once the data starts flowing again), losing all faith in the numbers that are published would be a far worse situation for the country.

-- Chris Weigant

Follow Chris on Twitter: @ChrisWeigant