The Consumer Price Index rose 3.1% for the 12 months that ended in November, a slight drop from the 3.2% annual rate recorded for October, according to Bureau of Labor Statistics data released Tuesday.
On a monthly basis, the gauge that measures price changes for a basket of goods and services ticked up 0.1% from October.
Shelter prices rose for the second consecutive month, helping to offset the fall in gas prices, which sank 5.8% from October. Food prices moderated from the month before.
Economists were expecting prices to stay flat over the month and for the annual rate to ease to 3.1%, according to Refinitiv.
When stripping out food and gas prices (components that tend to be more volatile), core CPI rose 0.3% from October, bringing the annual increase to 4%. In October, core CPI rose 0.2% monthly and 4% annually.
Core CPI remains at its lowest level since September 2021, according to BLS data.
The Federal Reserve has been on a monthslong campaign of rate hikes to bring down inflation, which soared to a 41-year high last year. The central bank will make its latest monetary policy decision on Wednesday, and is largely expected to leave its benchmark rate unchanged again.
“This will not have any meaningful impact on tomorrow’s likely decision to hold rates steady, but it provides the Fed some ammunition to reiterate that rate cuts as early as March 2024 remain premature,” said Olu Sonola, head of US regional economics for Fitch Ratings, in commentary Tuesday morning. “Goods and energy deflation continue to be the much-needed gift that keeps on giving. However, the acceleration in core services inflation across both shelter and non-shelter services is a reminder that the sustained downward path in core services inflation that the Fed wants to see is still not within reach.”
Sonola added: “The trend is still undoubtedly encouraging, but the fine details here will sow some doubts.”
This is a developing story and will be updated.
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