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The US central bank cut interest rates on Wednesday, marking the second rate cut this year during financial volatility stemming from the government closure and trade duties.

Move Comes at Unprecedented Moment for Central Bank

The move to reduce the key rate by a 0.25% to a range of 4% to 3.75% comes at an unprecedented moment for the central bank. The authority has been under significant strain to cut rates despite ongoing price increases.

Central Bank Announcement Highlights Labor Market Changes

In a announcement, the Federal Reserve said that the unemployment rate had gone up but stays modest. “Employment growth have decelerated,” the statement notes. “Price increases has risen and remains moderately high.”

Federal Closure Complicates Central Bank’s Task

The continuing federal government shutdown, now among the lengthiest in US history, has also hindered the Fed’s job. Gathering of important economic data has been indefinitely halted as staff at the Bureau of Labor Statistics are furloughed during the closure.

Data Gap Affects Policy Decisions

The Federal Reserve usually studies BLS data to determine labor market conditions, including the count of new jobs created to the market and the current jobless percentage. The most recent employment data was released in the beginning of last month, prior to the shutdown, and provided a relatively bleak snapshot of the employment scene in August.

The figure of jobs created to the market in the summer month was down by over 100k since the earlier season, and joblessness rose to 4.3% – the peak since three years ago.

Private Data Indicate Ongoing Decline

Though the bureau was scheduled to publish last month’s employment data in the start of last month, it halted its release when the closure began. Private payroll firm a leading payroll processor reported recently that the business segment eliminated 32,000 positions in September, a indication that the employment landscape is continuing to slow.

“Supply as well as demand for labor has declined significantly,” Fed chair the Fed chairman said earlier this month, a trend he had earlier attributed comes from immigration and tariff policies.

Inflation Report Shows Moderate Rise

Though BLS’s jobs report has been paused, the bureau still issued its price statistics for September that showed that prices are going up, although gradually. Prices increased three percent over the past twelve months, the peak since the start of the year. In April, the yearly price increase was 2.3%, the minimum it has been since three years ago. The Fed’s target inflation rate is 2%.