CPI Data Shows Cooling Inflation, Potential Rate Cuts Ahead
The November Consumer Price Index (CPI) report revealed a cooling inflation rate of 2.6%, down from 3.0% in September and below estimates. This data assists in forecasting potential Federal Reserve rate cuts in 2026, with markets reacting positively as a result.
Investors now assign nearly 47% odds to a quarter-point rate cut in March 2026, with about 12% odds for a 50-basis-point cut. Additionally, the unemployment rate has risen to 4.6%, exceeding earlier projections, which may prompt the Fed to act more decisively to stabilize the labor market.
