According to the latest data released by the U.S. Department of Labor, inflation in the United States showed an unexpected easing trend in November, with prices rising 2.7% year-on-year, a significant slowdown from 3% in September, and below the general forecast by economists. (The Bureau of Labor Statistics had interrupted its data collection work in October due to a government shutdown, so no inflation data was released for that month.) This is the lowest inflation increase since July. The core consumer price index, which excludes volatile items such as food and energy, rose 2.6% year-on-year, recording the lowest increase since March 2021. For the White House, which is facing "affordability" pressure, this is undoubtedly a strong boost, but this good news also comes with uncertainty caused by the government shutdown.
White House Press Secretary Levitt confidently stated that the trend of falling prices and rising incomes is expected to continue into the new year! Harriet Miers, the Director of the National Economic Council, called it an "absolute blockbuster news" on Fox Business Channel. In the context where Democrats have been winning elections by highlighting cost-of-living issues and making it difficult for Trump to control the narrative, this latest consumer price index report is a "timely rain." At the same time, it further indicates that large-scale tariff measures have not yet triggered a surge in prices. Cooling inflation may also make the Federal Reserve more willing to cut interest rates again, which has been Trump's long-standing demand. The stock market rose on the back of the inflation data and the subsequent expectation of rate cuts. However, due to the impact of the government shutdown, the reliability of the November price data is more uncertain than usual. Fed Chair Powell had already issued a warning before the inflation data was released, stating that the data "may be distorted by very technical factors," such as excessive influence from Black Friday sales, and therefore the Fed must view it with "suspicion." Some economists have also questioned some assumptions made by the Bureau of Labor Statistics for October data, including estimates of rent. In this context, the next report on December inflation will be more closely watched. However, it can be basically confirmed that inflation did not significantly accelerate during the autumn this year.
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Original article: toutiao.com/article/1851908991178059/
Statement: This article represents the personal views of the author.