CPI inflation: Price increases in the US ease in November

Price increases in the US eased in recent months, as costs for items including hotels, milk and some kinds of clothing fell.

The latest figures from the Labor Department showed prices rose 2.7% over the 12 months to November. That pace was down from 3% in September and lower than many analysts had expected, potentially bolstering the case for the US central bank to continue cutting interest rates.

The signs of cooling inflation came as frustration over years of rising prices has raised pressure on US President Donald Trump to deliver on his promises of relief.

The consumer price index (CPI) report had been delayed by the US government shutdown, which also prevented collection of some data.

Art Hogan, chief market strategist at B. Riley Wealth, said the report reflected discounts offered by retailers in November, as the holiday shopping season swung into gear. But he noted that without the October data it was difficult to draw too many definitive conclusions about wider trends.

“All told this is a positive report, that comes with an asterisk,” he said. “Subsequent CPI’s will likely smooth out the statistical errors that might have been present in today’s report.”

The report showed an unusual slowdown in the price increases for rents and other housing costs, which are weighted heavily in US inflation calculations and have been a key point of concern for many households.

But Bernard Yaros, lead economist at Oxford Economics, cautioned that the easing might “be more noise than signal due to the disruptions from the shutdown”.

Inflation in the US has been ticking up in recent months, fuelled in part by price rises for items, such as toys, appliances and furniture, that were affected by the wave of tariffs Trump announced earlier this year.

He has since rolled back some of those plans, including most recently announcing exemptions from tariffs for high-profile consumer food staples like bananas and coffee.

The White House has blamed frustrations on the jump in prices that Trump inherited when he entered office, while arguing that any further rise in prices associated with tariffs would be a one-time move.

But analysts have been concerned about price pressures spreading into other areas, especially as Trump’s crackdown on immigration tightens the supply of workers in sectors such as farming, hospitality and construction.

In a primetime address on Wednesday, Trump claimed that inflation had “stopped”.

He called on the Federal Reserve to deliver relief in the form of lower borrowing costs, promising to name a new person to lead the US central bank “who believes in lower interest rates by a lot”.

Some analysts said Thursday’s report could help convince the Fed that further cuts would be appropriate, even though inflation, despite the president’s claims, remains above the 2% rate considered healthy.

“Today it got to see inflation moving in the right direction,” said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management. “Inflation may still be above target, but today’s data made the opening for additional rate cuts just a little wider.”