US Inflation Slows in November Amid Federal Shutdown Disruptions
The US Consumer Price Index (CPI) rose 2.7% year-over-year in November, down from 3.0% in September and below many expectations. This slowdown in inflation could potentially support Federal Reserve rate cuts. However, CPI data for November were delayed due to the federal government shutdown, which also disrupted data collection efforts.
Housing costs, particularly rents, slowed unusually during this period, reducing inflation’s overall weight in the index. Analysts noted that discounting in November contributed to the lower price readings, although the absence of October data makes it difficult to firmly assess trends.
Some economists caution that the slowdown might represent noise caused by the shutdown disruptions, while others observe that inflation remains above the Federal Reserve's 2% target. Earlier tariffs had increased prices on various goods such as toys, appliances, and furniture, but President Trump has rolled back some tariffs—like exemptions on bananas and coffee—and indicated further relief measures.
In a primetime address, President Trump declared that inflation had stopped and urged the Federal Reserve to reduce interest rates, promising to appoint a Fed leader who would favor lower rates. Analysts, including Ellen Zentner, say the report could justify additional rate cuts, acknowledging that inflation is moving in the right direction but still above the target.
Concerns persist regarding broader price pressures stemming from labor supply shifts related to immigration policy.
