Traders Weigh Inflation Easing, Await Fed Clarity Ahead of Rate Cuts

The U.S. core Consumer Price Index (CPI) eased in November, marking the slowest annual increase since 2021, according to a report released by the Bureau of Labor Statistics. The core CPI, which excludes volatile food and energy costs, rose 2.6% year-over-year, falling short of the 3.0% expected by economists. The broader CPI measure climbed 2.7% compared to the same period last year, again below the 3.1% forecast.

The report comes amid ongoing uncertainty due to the recent government shutdown, which disrupted data collection for October, complicating monthly comparisons. The Bureau noted it would not publish 1-month percent changes for November as a result. Despite this, the data suggest that inflationary pressures are continuing to ease, though not as rapidly as some policymakers had hoped.

Investors and analysts will closely watch whether this trend persists, as it could influence the Federal Reserve's upcoming policy decisions. Markets have already priced in further rate cuts, with the Fed signaling its willingness to ease policy in response to a slowing labor market.

How Markets Reacted

Financial markets reacted cautiously to the CPI release, with stock futures initially edging higher but showing mixed momentum as the day progressed. Micron Technology surged 10% in premarket trading following its better-than-expected earnings report, while Darden, the parent company of Olive Garden, also gained on improved sales forecasts according to CNBC. However, the S

CPI Trend