CPI Report Today: October Inflation Came In Hot at 0.4% — and Core Hit Gov. Waller's 0.3% Line Exactly
The number the whole week waited on is in: consumer prices rose 0.4% in October, more than forecast, and core prices rose 0.3% for a third straight month — precisely the reading a Federal Reserve governor said hours earlier should put a half-point December hike on the table.
The October consumer price report landed at 8:30 a.m. Eastern and it did not give the Federal Reserve the cooling it was hoping for. The Bureau of Labor Statistics said the Consumer Price Index rose 0.4% last month after advancing 0.6% in September — slower than September, but above the 0.3% economists polled by Reuters had forecast. Excluding food and energy, the so-called core index rose 0.3%, the third straight month at that pace, against a forecast of 0.2%.
Inside the report, the pressure sat where New York households feel it first. Food prices rose 0.5% in October, with groceries up 0.4% and restaurant meals up 0.5%, per the bureau's release. Shelter costs rose 0.3% and accounted for over thirty percent of the monthly increase. Energy rose 0.7% — a sharp slowing from September's 5.2% surge, with gasoline up 1.0% after jumping 9.1% — and used car and truck prices fell 1.2%, one of the few soft lines in the release. The report arrived without its familiar annual rate: the BLS collected no October 2025 data during last year's government shutdown, so no 12-month comparison exists; the last annual reading, for September, was 3.7%, well above the Fed's 2% target.
The print also landed on a line drawn in public the same morning. Federal Reserve Governor Christopher Waller, in remarks prepared for delivery in London before the release, said he would support a quarter-point rate increase in December even if inflation improved — and that a core reading of 0.3% or more should put an upsized half-point hike under consideration. Core came in at exactly 0.3%. Reuters reported the immediate market verdict: stocks tumbled, with Nasdaq futures down 1.4% and S&P 500 futures down 0.8%, two-year Treasury yields jumped 13 basis points to 4.68%, and the dollar index rose 0.3% to 102.05. The Federal Open Market Committee meets December 9 — one day before the next inflation report — which makes this hot October print the last one the voters will see before they decide between a quarter point and a half.
