from CNBC Television
Inflation Back On the Radar Ahead of Fed Meeting
This week will provide fresh data on inflation with price levels remaining above the Federal Reserve’s target.
by Tim Smart
USNews.com
Inflation, like beauty, is in the eye of the beholder.
Back in 2022, when the consumer price index hit the 9% level, Democrats argued it was “transitory” and would subside after the supply chain disruptions of the COVID-19 pandemic disappeared. Republicans branded the runup in prices “Bidenflation.”
Yet, a survey of consumer sentiment that came out Friday showed Republicans believe President-elect Donald Trump will crush inflation while Democrats want to buy things now before they cost more.
Economists – and the Federal Reserve – however, are going to look at the data and this week will provide more of it. On Wednesday, the Labor Department will issue the CPI – a measure of how prices for a common basket of goods behave over time – for November with expectations for an increase of 0.3% for the month and an annual rate of 2.7%. That would be a slight increase from November’s 0.2% and 2.6% readings.
November CPI Forecasts Show Stalled Progress On Inflation
With inflation still above the Fed’s target, the last mile is proving stubborn.
by Sarah Hansen
Morningstar Advisor
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Forecasts for the November Consumer Price Index report find that inflation remained relatively steady last month. Price pressures have eased dramatically since peaking in the summer of 2022, but progress is slowing significantly as the inflation rate approaches the Federal Reserve’s target.
Overall, economists expect that consumer prices rose 0.2% on a monthly basis in November, according to FactSet’s consensus estimates. That would mean the annual inflation rate rose slightly to 2.7% from 2.6% in October. Economists expect the core measure of inflation (which excludes volatile food and energy prices) rose 0.28% in November, which would keep the annual rate steady at 3.3%.
“We actually haven’t seen a tremendous amount of change in the data over the last month,” says Josh Hirt, senior US economist at Vanguard. He adds that the overall inflation rate remains rangebound at 2.5%-3.0%.
What to Expect From This Week’s Inflation Report
The Consumer Price Index Likely Changed Little In November, Forecasters Say
by Diccon Hyatt
Investopedia
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Inflation has barely budged in recent months, and that trend is likely to continue in November.
An inflation report from the Bureau of Labor Statistics due Wednesday is likely to show the Consumer Price Index, a measure of the cost of living, rose 2.7% in the 12 months ending in November, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal.
That would be up from a 2.6% annual increase in October and the highest inflation rate since July, marking a setback in the Federal Reserve’s battle to get inflation down to a 2% annual rate and keep it there.
Bureau of Labor Statistics via Federal Reserve Economic Data. “Consumer Price Index for All Urban Consumers: All Items in U.S. City Average.”
Progress against inflation has stalled in recent months, contrasting earlier in the year when price increases were notably decelerating.
Brazil Analysts See Higher Key Rate and Inflation Through 2027
by Maria Eloisa Capurro
Yahoo! Finance
The benchmark Selic will rise to 12% at Wednesday’s policy decision, up from the prior estimate 11.75%, according to a weekly central bank survey of economists published Monday. Analysts also lifted their forecasts for the key rate at the end of next year to 13.5%, from 12.63% before.
Borrowing cost cuts are only expected to start in 2026, when the Selic is seen at 11% before falling to 10% in 2027.
Central bankers led by Roberto Campos Neto are widely expected to extend their tightening cycle from the current level of 11.25% while also reinforcing their commitment to haul inflation to the 3% target.
Used-Vehicle Prices Turn Into Inflation Headwind, After Historic Two-Year Plunge Helped Power the “Deceleration” of Core CPI
by Wolf Richter
Wolf Street
Prices are rising again, amid tight supply, sharply reduced flow through the used-vehicle pipeline, and strong demand.
Prices of used vehicle sold at auctions across the US jumped by 1.3% in November from October, seasonally adjusted, continuing an upward trend that started over the summer, according to the Manheim Used Vehicle Value Index, which is adjusted for changes in mix and mileage (red in the chart).
This jump flipped the year-over-year reading to the first increase (+0.2%) since August 2022, after the historic plunge during which prices gave up nearly 50% of the pandemic spike, with a bottom in mid-2024. Now prices have turned around.
Letters to the Editor: Are Voters Economically Illiterate When it Comes to Inflation?
from LA Times
To the editor: Economics professor Aine Seitz McCarthy says Americans ought to retake Econ 101. Reading her piece, I think she ought to take it herself.
Expanding the money supply causes inflation. What else would one expect from the succession of major spending bills that came from this administration and increased the national debt to more than $36 trillion?
McCarthy proposes government spending increases on social welfare programs. So where does the money come from? Either you tax for it or borrow it. Interest payments on the national debt now total more than $1 trillion yearly.
Trump Sticks by Tariffs, but No Guarantees On Inflation
by Ben Berkowitz
Axios
President-elect Trump reiterated his promises to impose tariffs and increase oil production, even if it impacts consumers.
Why it matters: By sticking to his campaign pledges, Trump would all but assure a fresh spike in inflation, which was a deciding factor in the election.
The big picture: In a sitdown interview with NBC’s “Meet the Press” that aired Sunday, Trump renewed his most important economic plans.
On tariffs, Trump stood by his promise for new levies on major trading partners, which he always insisted those other nations would pay.
Gold Prices Edge Up as U.S. Inflation Data Awaits
by Finimize Newsroom
Finimize
What’s going on here?
Gold prices have climbed to $2,631.60 per ounce as investors keep a keen eye on US inflation data and recent geopolitical changes in Syria.
What does this mean?
Investors are eagerly awaiting US inflation data due Wednesday, which could influence the Federal Reserve’s next move on interest rates. The CME Group’s FedWatch Tool suggests an 85.1% chance of a 25-basis-point rate cut this month. Meanwhile, the US labor market demonstrated resilience, adding 227,000 jobs in November after October’s hurricane impact, though unemployment inched up to 4.2%. Meanwhile, the situation in Syria highlights gold’s traditional role as a safe haven. As these factors unfold, gold’s appeal as a protective asset remains strong.
Albertans Being Savvy Shoppers, Some Reconsidering Having Kids as Food Costs Set to Increase
by Karen Bartko
Global News, Canada
From thinking twice about buying certain products to the much weightier decision over whether to even have kids, the already high cost of living is hitting home for Albertans as the latest Canada Food Price Report predicts groceries will get even more expensive in 2025.
Food prices in Canada are likely to increase by three to five per cent overall next year, according to the 15th annual food price report released by a partnership between researchers at Dalhousie University, the University of Guelph, the University of Saskatchewan and the University of British Columbia.
“We’re just trying to get by, but five per cent is pretty disheartening to hear,” Edmonton resident Sydney Dick said outside a southside Walmart store on Thursday.
Top Federal Reserve Official Warns Progress On Taming U.S. Inflation ‘May Be Stalling’
Governor Christopher Waller says he still supports a December interest rate cut barring a surprise in the economic data
by Colby Smith
FT
Christopher Waller, a Fed governor who sits on the policy-setting Federal Open Market Committee, on Monday said he backed the central bank lowering rates at its December 17-18 meeting. He said still-elevated borrowing costs were curbing demand across the world’s biggest economy, contributing to easing price pressures.
Still, Waller noted that “if the data we receive between today and the next meeting surprise in a way that suggests our forecasts of slowing inflation and a moderating but still-solid economy are wrong, then I will be supportive of holding the policy rate [unchanged in December]”.