Slower US inflation leaves Waller’s half-point December hike in play
Core CPI was unchanged at 0.3% for a third month, matching the approximate level in Waller's conditional December policy discussion before the release. Read the full story on CryptoSlateUnderstand the crypto stories that matter and what to watch next. Get The Catalyst in your inbox
US monthly headline inflation slowed in October, but core prices rose 0.3% for a third consecutive month, matching the level Federal Reserve Governor Christopher Waller had associated with considering a 50-basis-point December interest-rate hike.
The Bureau of Labor Statistics reported on Nov. 10 that consumer prices increased 0.4% from September, seasonally adjusted, after September's 0.6% rise. Core CPI, which excludes food and energy, rose 0.3%. The agency did not publish headline or core year-over-year rates.
That leaves a policy tension beneath the slower headline figure. In prepared remarks earlier that day, before the release, Waller said core CPI around 0.3% or higher would warrant considering a 50-basis-point December hike if the report resembled the preceding two monthly readings. He had leaned toward 25 basis points under his expected outlook.
October's core reading matches that approximate level. The comparison does not establish Waller's assessment after the release or a decision by the Federal Open Market Committee.
Related ReadingPrices continued to increase in October, even though the overall monthly pace eased. Energy rose 0.7%, following a much larger 5.2% increase in September. Food prices also increased, with the index rising 0.5% in October.
Shelter increased 0.3% and accounted for more than 30% of the monthly headline increase, according to BLS.
The core result shows why the headline slowdown offers only part of the picture. Removing food and energy leaves the same 0.3% monthly increase recorded in August and September. There was no corresponding improvement in that monthly measure.