US consumer prices rose 0.4% in October on a seasonally adjusted basis, the Bureau of Labor Statistics said. Economists had expected 0.3%, so the October number came in above forecast.

Core inflation also beat economists' forecasts

Core CPI, which excludes food and energy, rose 0.3% in October, the same as in September and August. Economists had expected 0.2%.

By category, the food index rose 0.5% and the shelter index rose 0.3%. Shelter alone accounted for over thirty percent of the monthly increase. The energy index rose 0.7%, with gasoline up 1.0%. Among core items, recreation, medical care and motor vehicle insurance all rose.

The bureau also noted that because October 2025 data are missing, it cannot publish 12-month changes for some October 2026 indexes.

Waller drew the line before the data

Christopher Waller, a governor at the Fed, the US central bank, spoke in London on November 10, before the CPI release. He said that even if October inflation improved, he would still support a 25 basis point hike at the December meeting. If core CPI rose around 0.3% or more, he said a 50 basis point hike should be considered in December, and that moving only 25 basis points would put the Fed's credibility at risk.

Core CPI came in at 0.3%.

Logan: at least two more hikes

Dallas Fed President Lorie Logan spoke the same day and said October CPI was higher than expected. She said the Fed needs at least two more 25 basis point hikes, and that it may be possible to move faster this winter than it has this fall. The Fed raised rates by a quarter point in September and held them in October.

Bowman: more work to do

Fed Vice Chair for Supervision Michelle Bowman spoke at the Council on Foreign Relations in Washington. Based on that day's CPI, she said 12-month core PCE inflation likely rose to 3.3% in October. That is her estimate, not official data.

Bowman said tariffs, energy and AI-related price pressures each accounted for roughly one-fourth of above-target core PCE inflation in the year through September. She sees inflation pressures persisting and the labor market firming, and said there is still work to do to bring inflation back near 2%. Her speech did not say the Fed will hike in December.

She also said lower stock prices, higher private interest rates and a stronger dollar have already tightened financial conditions, and that the benefits of further tightening must be weighed carefully against the costs.

How markets are pricing December

CME FedWatch data on November 10 showed an 88.3% chance of a quarter-point hike in December and an 11.7% chance of a half-point hike. Anderson, US head of crypto trading firm STS Digital, said that after the CPI release, markets were pricing about 27 basis points of tightening into the December rate curve.

Treasuries, gold and bitcoin

US Treasury data show the two-year yield at 4.56% on November 9 and 4.73% on November 10. Gate market data show spot gold briefly fell below $4,015 an ounce. According to CoinGecko, bitcoin traded near $73,274 and total crypto market value stood at $2.57 trillion.

What comes next

Bowman said the Fed will see the October PCE inflation report and the November employment report before its December meeting. The Bureau of Labor Statistics is scheduled to release November CPI on December 10.

Sources