Topline<\/p>\n
Inflation improved in October before rising again in November, according to delayed federal data released Thursday, as the Federal Reserve\u2019s favored inflation gauge aligned with Wall Street\u2019s expectations.<\/p>\n
Earlier delayed data indicated inflation cooled in the month.<\/p>\n
AFP via Getty ImagesKey Facts<\/p>\n
Annual inflation was 2.7% in October 2025 before increasing to 2.8% November, according to core consumption expenditures (PCE) price index data reported Tuesday by the Bureau of Economic Analysis, which last reported core PCE of 2.8% for September.<\/p>\n
November\u2019s core PCE matched Wall Street\u2019s estimates, according to FactSet. <\/p>\n
The Federal Reserve favors<\/a> core PCE data over consumer price inflation reports because the central bank can better understand how Americans spend their money and how their spending habits shift over time.<\/p>\n Headline PCE was 2.7% in October and 2.8% in November, meeting economists\u2019 estimates.<\/p>\n What To Watch For<\/p>\n The Federal Reserve will conclude its latest policymaking meeting on Jan. 28, though traders have priced in just 5% odds for interest rates to decline in a fourth-straight vote, according to CME\u2019s FedWatch tool<\/a>. Fed Chair Jerome Powell has signaled the Fed would likely pause on another cut after cutting interest rates to between 3.5% and 3.75% in December, noting the central bank and policymakers would \u201cwait and see how the economy evolves\u201d before additional cuts. <\/p>\n Key Background<\/p>\n President Donald Trump has claimed inflation in the U.S. has cooled significantly, saying Wednesday there was \u201cvirtually no inflation\u201d and claiming he had \u201cdefeated\u201d inflation over the last year. The Federal Reserve aims for an annual inflation of 2%, and has remained above that target for 57 consecutive months. Fed officials have shifted concerns to a cooling labor market over the last year, though they have pointed to high inflation in recent votes to lower interest rates. Moody\u2019s chief economist Mark Zandi told CNBC<\/a> that inflation is still \u201cuncomfortably high,\u201d noting inflation is \u201cespecially problematic\u201d for lower- and middle-income Americans as prices for groceries, electricity, apparel, furniture, childcare and healthcare have risen.<\/p>\n