The U. CPI for November released last week increased by 2.7% yearonyear, rising for the second consecutive month. The core CPI annual rate was 3.3% for the third consecutive month, in line with expectations.
Although November's retail sales report showed that consumption remained strong, it did not seem to have any impact on expectations of an upcoming interest rate cut by the Federal Reserve.
Ian Lyngen, an analyst at BMO Capital Markets, said:
“There is nothing in the report that will change expectations mexico phone number list for tomorrow’s FOMC meeting, as a 25bp cut remains the consensus, while Powell is seen as positioning the market for a pause in early .”
According to the CME FedWatch tool, traders believe there is a 97.1% chance that the Fed will cut interest rates by 25 basis points.
However, with strong retail sales and a pickup in inflation data in recent months, the Fed may pause its rate cuts in January.
The Fed's situation will be further complicated by the policies that Presidentelect Trump plans to implement when he takes office in January , including tariffs on imported products and the largescale deportation of illegal immigrants.
Oliver Allen, senior U. economist at Pantheon Macroeconomics, said persistent, abovetarget inflation will weigh on the Fed’s decisionmaking next year.
“But because tariffs will squeeze real aftertax income and undermine confidence, we think the committee will initially be more concerned about the labor market.