Consumer prices climbed 0.4% in October, outpacing the 0.3% increase economists had forecast, while core inflation rose 0.3%, also above its 0.2% projection. The fresh reading on the nation's cost of living arrives as traders and policymakers weigh whether the Federal Reserve will raise interest rates again next month.
Prices Climb Faster Than Expected
The seasonally adjusted Consumer Price Index rose 0.4% in October, according to CNBC, which cited Dow Jones-surveyed economists who had been looking for a smaller 0.3% gain. Core CPI, which strips out volatile food and energy costs, increased 0.3% last month, also exceeding its 0.2% forecast. As Bloomberg described it, the firm October advance likely keeps the central bank on track to raise rates next month.
Shelter costs were a major driver behind the month's increase. The category rose 0.3% in October and accounted for more than 30% of the headline CPI gain, the station's report notes, citing figures from the Bureau of Labor Statistics. Energy prices, meanwhile, rose just 0.7% in October, a sharp slowdown from the steep 5.2% spike recorded in September, according to Investing.com.
A Missing Comparison Point
Notably absent from the release was the usual year-over-year CPI comparison. The Bureau of Labor Statistics did not publish annual change figures for either headline or core CPI in October, per the same CNBC account, which attributed the gap to the 2025 government shutdown preventing the bureau from collecting sufficient inflation data in October 2025. The U.S. Bureau of Labor Statistics has said in its own FAQ on the matter that most CPI operations, including data collection, were suspended from October 1, 2025, through November 12, 2025, during that shutdown.
The October reading follows a hotter September, when headline CPI rose 0.6% while core CPI climbed 0.3%, according to the earlier CNBC figures. Investing.com's account of the monthly comparison similarly noted that the index eased to 0.4% in October after that 0.6% September increase.
What It Means for the Fed's Next Move
At their October meeting, Fed officials voted 10-2 to hold the benchmark interest rate in a range of 3.75% to 4%, CNBC reported. Market watchers are now focused on the central bank's December 8-9 meeting, though exactly how confident traders are remains murky. One CNBC report said traders had fully priced in a quarter-percentage-point increase for December and assigned just a 13.6% chance to a half-point move. A separate CNBC report described markets pricing in a better than 80% chance of a quarter-point December increase with no chance of a half-point hike, illustrating how estimates have varied across coverage.
Fed Governor Christopher Waller added his own view in a report carried by CNBC, saying he would support a quarter-point rate increase in December and might push for a half-point move if inflation data comes in worse than expected. No rate decision has yet been made, and the Fed's next scheduled meeting remains weeks away.
