US October Inflation Came in Above Expectations
The Consumer Price Index in the US recorded a 0.4 percent increase in October. Following the data that came in above market expectations, attention turned to the Fed's interest rate decision meeting in December.
In the United States, the Consumer Price Index (CPI) increased by 0.4 percent on a monthly basis in October, coming in above the market expectation of 0.3 percent. Core CPI, which excludes food and energy prices, rose by 0.3 percent monthly, exceeding the expectation of 0.2 percent.
When sub-items are examined for October, food prices showed an increase of 0.5 percent, energy prices 0.7 percent, and gasoline prices 1 percent. During the same period, shelter costs rose by 0.3 percent, while there was no change in the real earnings of private sector employees. Following the inflation figures announced as 0.6 percent monthly and 3.6 percent annually in September, the Bureau of Labor Statistics did not publish the annual changes for October, citing disruptions in the data collection process last year due to the government shutdown.
The released data marked the last CPI report that Fed officials will see before their policy meeting on December 8-9. While the exceeding of expectations strengthened interest rate hike forecasts in the markets, Fed Governor Christopher Waller had stated prior to the data that if core CPI rises by 0.3 percent or more, interest rates might need to be raised with a larger half-point increase. The report also cited the Iran war, tariffs, and the data center boom among the factors fueling inflationary pressures this year.