US inflation expected to stay above Fed target in November
Inflation data scheduled for release Thursday morning is expected to show that price increases remain above the Federal Reserve’s target, marking the final major piece of US economic data affected by the government shutdown.
The November Consumer Price Index (CPI) report, set for 8:30 a.m. ET, is projected to show headline prices up 3.1% from a year ago, according to Bloomberg data, News.Az reports, citing Yahoo Finance.
Core CPI, which excludes the often-volatile food and energy categories, is also expected to rise 3.1% year-on-year.
In September, the last month for which inflation data is available, both headline and core CPI measures had risen 3% compared with the previous year. Thursday’s report will be the first official inflation reading since September, as the Bureau of Labor Statistics canceled the October report due to the US government shutdown. As a result, November’s figures will not include month-on-month comparisons for headline or core CPI.
This should also mark the final time major economic data, notably the monthly jobs report and inflation data, is published on an altered schedule following the government shutdown that lasted 43 days earlier this year.
The November jobs report was released on Tuesday, showing more jobs were created last month than expected, while the unemployment rate hit a four-year high. The December jobs report is set for release on Jan. 9, 2026, returning to its typical spot on a Friday morning.
"Inflation is still above target ... but this should be temporary," said Jeffrey Roach, chief economist for LPL Financial. "As demand cools in the coming months, pricing pressures should ease, giving investors some breathing room."
Economists at Bank of America wrote in a report ahead of the release that goods inflation should "remain sticky owing to tariffs," while services "should be softer driven in part by health insurance."
This push-pull dynamic within the inflation data is likely to keep the Fed on the sidelines at the end of its January meeting, with traders currently pricing in a roughly 25% chance the central bank cuts rates next month.
Last week, the Fed's forecasts suggested it would cut rates only one more time in 2026 after cutting rates by 0.25% at three straight meetings to end 2025.
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