US consumer prices rose 0.4% in October, more than economists had expected, according to the Consumer Price Index report released by the Bureau of Labor Statistics on Tuesday, Nov. 10.
The increase was slower than September’s 0.6% jump, but it came in above the 0.3% forecast and keeps pressure on the Federal Reserve ahead of its final meeting of the year.
The story in 7 points
- Overall consumer prices rose 0.4% in October, above the 0.3% economists expected.
- That was a slowdown from the 0.6% rise recorded in September.
- Core prices, which leave out food and energy, rose 0.3%, also above forecasts of 0.2%.
- Shelter costs climbed 0.3% and made up more than 30% of the monthly increase.
- Food prices rose 0.5%, with restaurant prices rising at the same pace as groceries.
- No annual inflation rate was published because October 2025 prices were never collected during last year’s government shutdown.
- The 10-year Treasury yield moved back to around 5% as markets weighed a possible Fed rate hike in December.
The last annual reading, for September, showed prices up 3.7% from a year earlier, well above the Federal Reserve’s 2% target. Because the government shutdown in October 2025 left the Labor Department without data for that month, this report could only show the month-to-month change.
Higher energy prices were a major driver in recent months, with gasoline prices rising again in October. Shelter, the biggest single part of the index, rose 0.3% after a 0.4% gain in September, while rents rose 0.2%.
Why it matters
A hotter-than-expected reading makes it harder for the Fed to argue that inflation is cooling. Combined with a solid jobs report the week before, many analysts now expect the central bank to consider another rate hike at its Dec. 8–9 meeting, which would push borrowing costs for mortgages, cars and credit cards even higher.
The next CPI report, covering November, is due on Dec. 10, the day after the Fed’s decision.