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What you need to know
- Consumer Price Index (CPI) rose by 2.7% in November compared with 2.6% in Oct. It is now the second consecutive monthly that the inflation rate has increased year-over year.
- Groceries, used cars and other items have all seen a noticeable increase in price.
- Forecasters had predicted a low inflation rate, which has reinforced expectations that Federal Reserve officials will lower interest rates next week at their policy meeting.
Inflation continues to put pressure on household budgets, and consumer prices have risen in November. Grocery prices are up the most in two years.
Bureau of Labor Statistics announced Wednesday that Consumer Price Index has risen 2.7% year-over-year, a slight increase over 2.6% last October. The price of groceries rose by 0.5% in the last month. This is the largest monthly rise since January 2023.
The Dow Jones Newswires & The Wall Street Journal conducted a survey among economists to determine the inflation numbers for last month. The results were in line with what forecasters had predicted.
While inflation has cooled considerably since peaking at a 9.1% annual rate in June 2022, it remains above the Federal Reserve's goal of 2%. CPI grew on an year-overyear basis for the second straight month, November.
The Fed’s last policy meeting will be held on next Wednesday. It is expected that the Fed will cut its Fed Funds rate benchmark. Traders are now pricing in a 96% chance of a quarter-point rate cut next week, compared with the 86% likelihood that was being priced in before the inflation report was released, according to the CME Group's FedWatch Tool.
"Core" inflation, which excludes the volatile prices for food and energy, rose 3.3% over the year, the same as in October and also in line with expectations.
Economicians and policymakers are more attentive to the core inflation measure because prices of food and energy fluctuate without any connection to broader trends in inflation. The core inflation rate was significantly influenced by the 2% rise in prices of used vehicles between October, and November.
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