Consumer prices rose 0.4% in October, more than forecast, and traders now expect the Fed to raise rates in December
Food, energy and shelter all cost more in October. The report beat forecasts for a third hot month in a row and drew blunt words from a Federal Reserve bank president.
Key takeaways
- The consumer price index rose 0.4% in October after 0.6% in September, the Bureau of Labor Statistics said November 10, 2026.
- Core prices, which leave out food and energy, rose 0.3% for a third straight month; economists had forecast 0.2%.
- No 12-month rate was published because October 2025 data was never collected. The next CPI report is due December 10.
Consumer prices in the United States rose 0.4% in October on a seasonally adjusted basis, after a 0.6% rise in September, the Bureau of Labor Statistics said on Tuesday, November 10. Prices excluding food and energy, the core measure, rose 0.3%, the same as in August and September. Economists surveyed by Dow Jones had expected 0.3% overall and 0.2% for core, CNBC reported.
What went up, and what did not?
Food prices rose 0.5% after being flat in September, with groceries up 0.4% and restaurant meals up 0.5%, the bureau said. Energy rose 0.7%, including a 1.0% rise in gasoline and 0.9% in electricity, while natural gas fell 0.8%. Shelter rose 0.3%. Motor vehicle insurance rose 0.7% and hospital services 0.8%. Used car and truck prices fell 1.2%.
The release has no 12-month inflation rate for all items. The bureau said it did not collect survey data for October 2025 because of a lapse in appropriations, so there is nothing to compare against.
What does it mean for interest rates?
The Federal Reserve raised its benchmark rate by a quarter point in September to a range of 3.75% to 4% and held it there in October on a 10-2 vote, according to CNBC. After the report, futures traders fully priced in a quarter-point increase at the December 8-9 meeting, and CME FedWatch odds of a larger half-point move rose to 13.6% from near zero, CNBC said. Stocks fell and Treasury yields rose after the release.
Chicago Fed President Austan Goolsbee told PBS NewsHour on Tuesday, "It's another distressing report — borderline disturbing," CNBC reported. He declined to say whether he supports a December increase. Fed Governor Christopher Waller said before the data came out that a hot report could lead him to back a half-point hike, and Dallas Fed President Lorie Logan said she sees a need for two more quarter-point increases, according to CNBC.
What happens next
The November consumer price index is scheduled for Thursday, December 10, at 8:30 a.m. Eastern, one day after the Fed's meeting ends.
Sources
- U.S. Bureau of Labor Statistics, Consumer Price Index news release for October 2026, November 10, 2026
- CNBC, “Consumer prices rose 0.4% in October, more than expected, complicating Fed's inflation fight,” November 10, 2026
- CNBC, “Fed's Goolsbee calls inflation report 'borderline disturbing' as central bank weighs more hikes,” November 11, 2026
Written by Action Global News from the sources above; quotations are attributed to the outlet that published them. See our editorial standards and corrections policy.