US inflation slowed in October before picking up again in November, according to delayed federal data released on Thursday, offering a mixed picture for policymakers as they consider the next move on interest rates.
The Federal Reserve’s preferred inflation measure, the core personal consumption expenditures (PCE) price index, showed annual inflation eased to 2.7% in October 2025 before rising to 2.8% in November, the Bureau of Economic Analysis said. Inflation had stood at 2.8% in September.
November’s core PCE reading matched expectations on Wall Street, according to FactSet. Headline PCE inflation followed the same pattern, also rising from 2.7% in October to 2.8% in November.
The Federal Reserve closely tracks core PCE because it strips out volatile food and energy prices and offers insight into how consumer spending changes over time. The central bank has said this measure provides a clearer view of underlying inflation trends.
The data comes ahead of the Fed’s next policy meeting, which concludes on 28 January. Markets currently see only a small chance of another interest rate cut, after the Fed reduced rates in December to a range of 3.5% to 3.75%.
Fed Chair Jerome Powell has suggested policymakers are likely to pause further cuts, saying officials want to wait and see how the economy develops before making additional changes.
President Donald Trump has argued inflation has cooled sharply, saying this week there was “virtually no inflation.” However, inflation remains above the Fed’s 2% target and has done so for more than four years.
Economists have warned price pressures remain a concern, especially for lower- and middle-income households, as costs for essentials such as food, electricity, childcare and healthcare continue to rise.
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