The Bureau of Labor Statistics released November’s consumer price index Thursday, the first inflation report since the 43-day government shutdown that prevented October data collection
The Bureau of Labor Statistics released inflation data for November Thursday morning, marking the first Consumer Price Index report published since the government shutdown ended in mid-November. Economists surveyed by Dow Jones expect the report to show a 12-month inflation rate of 3.1%, with core CPI forecast to post an annual rate of 3.0% when excluding food and energy.
The release marks the first inflation reading for the period since the record-setting U.S. government shutdown ended last month. September’s CPI data, the most recent report published and only piece of economic data released during the shutdown, showed an annual reading of 3.0% for both headline and core measures.
Data collection challenges
The Bureau of Labor Statistics confirmed the November release would not include one-month percent changes where October 2025 data are missing. The agency canceled the October inflation report in late November, weeks before the Federal Reserve’s final meeting of the year, as employees did not collect all necessary data to determine how prices changed over October during the 43-day shutdown.
President Donald Trump officially signed a funding bill into law on November 12, reopening the government after 43 days of stoppage, the longest duration in U.S. history. That prompted the BLS to push back November’s CPI report from its previously scheduled release date of December 10.
The few data points BLS collected for October will be released alongside November’s data. However, without the full picture of October for comparison, grasping the extent of November’s price swings proves difficult. JPMorgan analysts wrote in a recent note that they expect the report to be more uncertain and likely incomplete relative to prior releases because of the gap in October data.
Significance of 2% versus 3% range
Whether the annual inflation reading lands in the 2% or 3% range carries significant psychological importance for markets and policy. José Torres, senior economist at Interactive Brokers, described the psychological distinction between a two handle and a three handle as paramount.
While consensus estimates show the annual rate hitting the 3% threshold for the month, Torres anticipates headline and core readings to be lower than expected at 2.9% each, though he thinks the range of possible outcomes for headline could be between that figure and 3.1%.
If the report shows a 2.9% reading, it could offer positive momentum in stocks heading into 2026. Torres believes such a number would clear the path for a Santa Claus rally. He also thinks it would impact the interest rate outlook for next year, a period during which the Fed projects one rate cut. Keeping inflation in the twos rather than increasing to the threes would allow more interest rate cuts next year by strengthening monetary policy easing expectations.
Market reaction expectations
Not everyone anticipates dramatic market response to small variations in the inflation figure. Victoria Fernandez of Crossmark Global Investments doesn’t see a 0.1 percentage point move in either direction as leading to huge market reaction. She also thinks Fed policymakers would remain in wait-and-see mode even with a 2.9% reading.
Fernandez characterized this as not a clean CPI number, citing the absence of month-over-month data as one factor and when exactly the BLS was able to begin collecting November data as another. By the time the government actually opened and data collection started, nearly halfway through November had passed, raising questions about potential bias in terms of what prices do and how things work in the latter half of the month versus the beginning.
The strategist thinks the overall theme will be that inflation remains high and is not making its way back toward 2% like some anticipate. A tremendous amount of uncertainty exists regarding future direction because of conflicting stories, with weak trends in unemployment, household income and consumer spending alongside expectations of 14% earnings growth next year and strong revenues.
Consumer concerns
Americans consistently report that inflation and everyday costs represent the most pressing economic issues they face. In an NBC Decision Desk poll released Sunday, 44% of adults chose inflation and the rising cost of living as their top concern. Thursday’s data finally puts a number on the feelings many consumers describe about rising prices.
September’s inflation data released during the shutdown showed that inflation rose to 3% that month, a slight increase from August’s rate of 2.9%. Prices for housing, airline tickets, recreation, household furnishings and apparel all increased measurably.
Federal Reserve context
Despite the October data gap, the Federal Reserve announced last week that it would cut borrowing costs by a quarter of a percentage point. Behind the decision were concerns about the labor market, which has shown signs of weakening in recent weeks. On Tuesday, BLS released new data showing job cuts jumped in October, pushing the unemployment rate up to 4.6% last month.
Asked about persistent inflation at a news conference in Washington, Federal Reserve Chair Jerome Powell pointed to President Donald Trump’s trade policy, stating that tariffs are causing most of the inflation overshoot.
In the wake of the shutdown ending, key data from another inflation measure has come to light, namely the delayed September reading of the personal consumption expenditures price index. However, investors are still awaiting the PCE reports for October and November, which have yet to be rescheduled. Delayed October producer price index figures are going to be revealed with the November PPI report, whose release has been postponed to January 14.