US consumer prices rose 0.4% in October, above the 0.3% monthly increase economists had forecast, while core prices rose 0.3% against expectations of 0.2%. The data intensified pressure on the Federal Reserve ahead of its December meeting, with markets increasingly pricing in an interest-rate rise.
By Adrian Jarysz, Director of Strategic Clients at Michael / Ström brokerage. Polish original published on 10 November 2026 at 18:10 UTC.
The Bureau of Labor Statistics (BLS) figures, released on 10 November, showed headline monthly inflation slowing from 0.6% in September. That was not enough to reassure investors: core prices, a key gauge of persistent inflation pressure, increased 0.3% for the third consecutive month.
Core inflation holds at 0.3%
Prices excluding food and energy rose at the same monthly pace from August through October. Higher oil prices are therefore only part of the problem, with increases also affecting services, recreation, medical care and motor vehicle insurance.
Shelter inflation eased from 0.4% in September to 0.3% in October, but the category still accounted for more than 30% of the monthly rise in the overall consumer price index (CPI). Recreation prices rose 0.8%, while motor vehicle insurance increased 0.7%.
Month-on-month change, %, seasonally adjusted
| Month | CPI | Core |
|---|---|---|
| Apr | 0.6% | 0.4% |
| May | 0.5% | 0.2% |
| Jun | -0.4% | 0.0% |
| Jul | 0.1% | 0.2% |
| Aug | 0.4% | 0.3% |
| Sep | 0.6% | 0.3% |
| Oct | 0.4% | 0.3% |
Navy: headline CPI; orange: core CPI. The June CPI bar shows the magnitude of the decline; the value retains its minus sign. Source: BLS, 10 November 2026.
Food and energy keep household costs rising
Food prices rose 0.5% in October after remaining unchanged a month earlier. Food bought for consumption at home increased 0.4%, while food away from home rose 0.5%; beef prices increased 0.9% and snack prices 1%.
Energy prices rose 0.7%, following September’s much sharper 5.2% increase. Gasoline rose 1%, compared with a 9.1% jump the previous month, and electricity increased 0.9%. Piped gas prices fell 0.8%, while used cars became 1.2% cheaper.
Monthly price change in selected categories, %
| Food | +0.5% | |
|---|---|---|
| Energy | +0.7% | |
| Gasoline | +1.0% | |
| Shelter | +0.3% | |
| Transportation services | +0.8% | |
| Electricity | +0.9% | |
| Used cars | -1.2% |
Source: BLS, seasonally adjusted. Categories represent different levels of aggregation and cannot be added together. Bar lengths show the size of each change; signs indicate its direction.
A data gap limits annual comparisons
The October release has an unusual limitation. During the federal government shutdown in October 2025, the BLS could not collect the data needed to calculate many price indices. As a result, it did not publish standard year-on-year changes for most categories for October 2026.
Some annual comparisons remain available for series with sufficient data, including gasoline, whose prices were 37.4% higher than a year earlier. That figure is not an annual inflation rate for the economy as a whole.
Markets price in a December Fed rate rise
Stronger-than-expected inflation makes it harder for the US central bank to return quickly to easier monetary policy. Energy costs remain elevated, while earlier import tariffs may continue to feed through into consumer prices.
Reuters reported on 10 November that futures markets, following the release, priced a December Fed rate rise as almost certain, with a 25-basis-point increase the most widely expected outcome. Market pricing does not amount to a policy decision: Fed officials will continue to assess inflation and employment data.
US stock indices fell, Treasury yields rose and the dollar strengthened. For businesses, the reaction points to the risk of financing costs staying high; for investors, it highlights valuations’ sensitivity to subsequent inflation releases.
November figures are due on 10 December
The next BLS release, covering November, is scheduled for 10 December. Another 0.3% monthly rise in core prices would reinforce the case for restrictive Fed policy, while weaker data could reduce the scale of expected rate increases.
Sources: Bureau of Labor Statistics, “Consumer Price Index – October 2026”, 10 November 2026; Reuters, “Hot October inflation report rattles markets”, 10 November 2026. Charts: CEO.com.pl, using BLS data.
