Inflation in the U.S. rose more than expected in October. What decision can we expect from the Fed?
The CPI index this time does not include a year-over-year comparison: last year, the government shutdown prevented data from being collected
The Consumer Price Index (CPI) in the U.S. rose 0.3% in October / Photo: Richard M Lee / Shutterstock
The Consumer Price Index (CPI) in the U.S. rose 0.4% month-over-month in October, according to the U.S. Bureau of Labor Statistics. This was higher than ING analysts had anticipated; they had expected the figure to be 0.3%. However, the pace of price growth slowed compared with September’s 0.6% increase.
The core CPI—which excludes volatile food and energy prices—rose 0.3% last month. This also exceeded the consensus forecast of 0.2%, according to CNBC. In September, core CPI rose by the same 0.3%.
The agency will not publish the annual figures: last fall’s government shutdown prevented it from collecting data for October 2025. Annual consumer inflation jumped 3.7% in September, and, according to economists, there was no reason to expect it to slow in October, even though the monthly growth rate declined slightly, Reuters reports. Inflation remains well above the Federal Reserve’s 2% target.
The lack of data from last year has no impact on the calculation of the Personal Consumption Expenditures (PCE) price index, which the Fed monitors to assess progress toward its inflation target. Both indicators remain above 3%, the agency notes.
What's Happening in the Markets
S&P 500 futures were down 0.3% following the release of inflation data, while Nasdaq 100 futures were down 0.8%. Dow Jones futures were up 0.1%.
What's next?
Federal Reserve Board member Christopher Waller said on November 10 that he considers a rate hike in December likely, and suggested the possibility of a half-percentage-point increase, according to CNBC. “While the exact timing of the hike is not critical, ensuring that the promised actions are implemented within a reasonable timeframe is extremely important,” Waller noted.
"In these data, you will see further evidence of firm and persistent inflation, particularly in the services sector. This will set the stage for a rate hike in December, and I don’t expect the October CPI report to cause the Fed to deviate from its chosen monetary policy path,” Reuters quotes RSM Chief Economist Joseph Brusulas as saying.
"The main risk preventing Fed officials from raising rates in December would be a further significant correction in the stock markets or a widening of credit spreads," said Citigroup economist Veronica Clark. Her comments were reported by Reuters.
This news story is being updated....
This article was AI-translated and verified by a human editor
