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Core US inflation (excl. energy and food) came in at 2.6% for November, below the 3.0% market consensus.
Energy costs rise 1.1%, food rises 0.2% over the two months to November.
Annual inflation rate cools to 2.7%, from 3.0% in September.
Jonathan Moyes, Head of Investment Research, Wealth Cub said, “The market was expecting core inflation to come in at 3.0% for November, in an early gift to markets, core inflation came in at 2.6%. This provides markets with much needed clarity after the government shutdown. The initial market reaction has been positive with both equities and bond markets rallying strongly.
All eyes will now turn back to the Federal Reserve. The message throughout 2025 has been one of caution. Clearly the Federal Reserve has been reticent of cutting too far too soon.
There are a number of crosscurrents in play, there were question marks over the extent to which trade tariffs will feed through into the inflation numbers, and next year, whether the big, beautiful bill will cause a big, beautiful return of inflation next year. What’s clear from todays’ reading – US inflation is softer than many thought, and this paves the way for looser monetary policy in 2026. The Santa rally might be coming to town.”
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