New government figures due Thursday are expected to show that price pressures remained elevated in November, offering the first official reading on inflation since a government shutdown disrupted the flow of economic data and left policymakers flying partly blind.
Economists expect consumer prices to have increased 3.1 percent from a year earlier, slightly hotter than the most-recent reading, from September.
The shutdown caused the Bureau of Labor Statistics to skip its October consumer price index survey, creating a break in the data that the agency cannot fully repair. While the BLS will publish October figures for a small number of components that draw on other sources of price data, it will not release an overall inflation or core CPI reading for that month. As a result, Thursday’s report will offer a year-over-year snapshot of inflation in November but omit many of the usual month-to-month comparisons, limiting insight into whether price pressures are accelerating or easing as the economy heads into winter
“Check back in February when we will have three months of data to get a better informed direction of the trend in inflation and turn-of-the-year price increases,” said Joe Brusuelas, chief economist at RSM.
Elevated inflation remains a challenge for President Donald Trump, who has sought to play down voters’ concerns by calling cost-of-living worries a “hoax,” likening them to what he has described as politically motivated scandals.
At the same time, Republican allies have urged patience, arguing that the White House’s sweeping new tax law and push to roll back regulations will take time to have an effect. But Trump finds himself facing a familiar challenge that weighed on President Joe Biden’s approval ratings even before the 2024 campaign began: Many voters say they don’t like the economy, regardless of headline indicators.
With month-to-month comparisons unavailable for Thursday’s report, economists say they will be parsing the remaining details of the report for clues about inflation’s underlying momentum. Particular attention is likely to fall on categories such as shelter, medical care and services, which have been key drivers of inflation over the past year and tend to move more slowly than goods prices. Analysts will also be watching whether price increases remain concentrated in a narrow set of categories or continue to spread more broadly — a pattern that could signal more persistent inflation even as economic growth cools.
The report lands at a moment of growing uncertainty about the broader economic outlook. Job growth has slowed sharply in recent months, and data released Tuesday showed further weakening, adding to concerns that the labor market is losing momentum even as inflation remains stubbornly high. The U.S. economy shed 41,000 jobs over October and November, and the unemployment rate climbed to 4.6 percent — its highest level since 2021 — a combination that is intensifying concerns about whether the economy is slipping into a more pronounced slowdown.
Despite the administration’s sweeping tariffs, higher costs were slow to show up in consumer prices, blunted at first by delayed implementation and a wave of stockpiling by companies eager to get ahead of the levies. Those buffers have largely been exhausted, however, and by this summer price increases had begun to spread across a broader range of goods — a shift economists say could make inflation harder to contain.
The unusual inflation report comes as the Federal Reserve is navigating an increasingly narrow path, caught between a labor market that is showing clear signs of strain and inflation that remains uncomfortably high. Fed officials have cut interest rates at three consecutive meetings since September, including last week, signaling that for now they are more focused on cushioning a softening job market than stamping out persistent price pressures.
Even so, policymakers have repeatedly described those decisions as close calls, with some warning that patience carries risks of its own.
In a speech Tuesday, retiring Atlanta Fed President Raphael Bostic cautioned that allowing inflation to run above the central bank’s 2 percent target for too long could erode the Fed’s credibility. “Credibility is a cornerstone of effective monetary policy,” Bostic said, warning that “a half decade — and likely soon to be longer — of missing the inflation target could well imperil the Committee’s credibility as a steward of price stability.”
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