US inflation appeared to ease in November, but economists are warning that the latest Consumer Price Index data should be interpreted carefully due to disruptions caused by the recent government shutdown.
The Bureau of Labor Statistics reported that headline CPI rose 2.7% year over year, below expectations of around 3.1%. Core inflation, which excludes food and energy, slowed to 2.6%, also under forecasts. The data initially fueled optimism that inflation is moving closer to the Federal Reserve’s 2% target.
However, the report lacked month-over-month comparisons because October price data was not collected during the shutdown, leaving gaps across many categories and limiting visibility into recent price trends.
Several economists questioned the reliability of the figures. Heather Long, chief economist at Navy Federal Credit Union, said the report was difficult to evaluate due to missing data, noting that the sharp slowdown in housing inflation does not align with private-sector indicators.
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Housing costs, which account for roughly one-third of CPI, were a central point of debate. The BLS reported shelter prices rose just 0.2% between September and November, a result some analysts believe may understate actual inflation. Harvard economist Jason Furman said the calculation likely assumed minimal price movement in October, which may have pulled inflation lower than reality, though he stressed the issue was technical rather than political.
Other economists pointed out that gasoline prices clearly helped ease inflation, with national averages falling below $3 per gallon to the lowest levels in more than four years. Seasonal discounting during Black Friday may also have affected pricing data, according to Pantheon Macroeconomics.
Federal Reserve officials have already signaled caution. Chair Jerome Powell said the central bank would take a skeptical view of the November data, given the data collection disruptions. While some policymakers see the report as progress, most agree it is not sufficient on its own to guide interest rate decisions.
Markets are now looking ahead to December CPI data, scheduled for release on January 13, which should provide a clearer and more complete picture as government data collection normalizes.
For now, economists broadly agree that inflation may not be accelerating, but the evidence for a meaningful slowdown remains inconclusive. The Federal Reserve is expected to remain in a wait-and-see posture until more reliable data becomes available.
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