November CPI Report: What the Experts Are Saying About Inflation

An underwhelming CPI report means the Fed isn't done fighting inflation just yet.

cpi report inflation
(Image credit: Getty Images)

Consumer prices remained essentially unchanged last month, the November Consumer Price Index (CPI) showed Tuesday, but sticky inflation for rent, food and other select goods and services means the Federal Reserve won't be cutting interest rates as soon as the market wants, experts say.

The central bank's rate-setting group, the Federal Open Market Committee (FOMC), wraps up the next Fed meeting on Wednesday, and it is widely expected to keep the short-term federal funds rate unchanged at a 22-year high.

What market participants really want to know is when the Fed will pivot to rate cuts – and the latest CPI report suggests they'll have to wait longer than they thought. 

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Headline inflation rose 0.1% in November after being unchanged the prior month, the Bureau of Labor Statistics said Tuesday. That was slightly higher than economists' forecast, which called for inflation to be flat once again last month.

On an annual basis, inflation slowed to 3.1% in November – or the lowest rate since early 2021 – from 3.2% the previous month, matching economists' estimate. 

However, so-called core inflation, which excludes volatile food and energy costs and is considered to be a better indicator of future prices, accelerated to 0.3% in November from 0.2% the prior month. Although the reading matched Wall Street's forecast, it revealed continued stickiness in key spending categories, including rents and used cars. On an annual basis, core inflation increased by 4% to remain well above the Fed's long-term 2% inflation target. 

Interest rate traders now assign a 42% probability to the Fed enacting its first quarter-point rate cut in March, down from 54% a week ago, according to CME Group's FedWatch Tool. Meanwhile, the odds of a first quarter-point cut in May rose to 50% from 41% a week ago. 

With the November CPI report now a matter of record, we turned to economists, strategists and other experts for their thoughts on what the data means for markets, macroeconomics and monetary policy going forward. Please see a selection of their commentary, sometimes edited for brevity or clarity, below.

Expert takes on the CPI report

cpi report inflation

(Image credit: Getty Images)

"The November CPI data probably do not move the needle much for the FOMC this week. Falling gasoline prices and modest food inflation restrained the headline CPI to just a 0.1% increase in the month. Excluding food and energy prices, core CPI was up 0.3%, in line with consensus expectations. Doves looking for a downside surprise did not see one materialize, but a nasty upside shock was also avoided." – Sarah House, senior economist at Wells Fargo

"Not a whole lot of inflation surprises in this report, but it does illustrate the task the Fed still has ahead of itself to bring services and housing inflation to heel. The drop in energy and commodity prices has been a huge relief over the last several months, but we need to see that moderation in prices seep further into core services and housing for the Fed to claim total victory in its inflation fight." – Scott Anderson, chief U.S. economist at BMO Capital Markets

"The big picture is that we remain on the path to lower inflation, though this month’s report is a reminder that the disinflation process will not be a straight line down, and there will be bumps along the way." – Sonu Varghese, global macro strategist at Carson Group

"The CPI report was yet again driven by lower energy prices and sticky shelter costs. Overall, today’s release confirms our forecast that the Fed will hold rates unchanged at tomorrow’s FOMC meeting. Additionally, core CPI on a year-over-year basis remained virtually unchanged in November, suggesting that core inflation might be stickier than the market believes, which should push rate cuts further into the second half of next year." – Eugenio Alemán, chief economist at Raymond James

"This morning’s report on November CPI shows further evidence of a broad disinflationary trend both domestically and abroad. Everything on the data front suggests a continuation of a wait and see approach by the Fed. Futures markets have essentially eliminated any chance of further rate hikes this cycle, and traders have shifted to handicapping the timing and magnitude of future interest rate cuts. Still, we expect Fed Chair Powell's remarks at tomorrow’s news conference to reiterate the FOMC’s commitment to keeping rates restrictive until they can officially declare victory over inflation, which we believe may take longer than the markets are currently expecting." – Ivan Gruhl, co-chief investment officer at Avantax

"This morning's inflation data came in largely in line with expectations. A few categories, such as housing and used cars, were a bit hotter than anticipated, offsetting a decline in energy costs. Nothing in this report is likely to dissuade Chair Powell from taking a hawkish tone following the Fed meeting, at which the FOMC will almost certainly hold rates steady for now." –  David Royal, chief financial and investment officer at Thrivent

"The CPI and core CPI came in as expected. We do not expect these numbers will have any impact on the Fed’s decision tomorrow. We expect the Fed to pause again tomorrow. There was some anticipation by investors that the CPI may surprise to the downside. Overall, this does not change our belief that inflation is slowing toward levels acceptable by the Fed. We believe there will be a lengthy pause from the Fed and rate cuts that will begin later in the year. We believe the upward trend in the market will continue into next year with small cap stocks leading large cap stocks in 2024." – Eric Green, chief investment officer at Penn Capital Management

"Core CPI remains at 4.0% despite a significant drop in oil prices, highlighting that overall inflation continues to be persistently high. Reducing inflation to the Fed's target of 2% is proving to be a substantial challenge and this month marks the 32nd consecutive month of inflation exceeding 3%. The pressing question now is whether it's time for the Fed to pivot its monetary policy? The prevailing belief is that we will continue to see an extended pause by the Fed in the coming year when they announce their policy decision tomorrow. However, based on today’s report it's clear that the Fed's mission to stabilize inflation is far from complete." – Scott Acheychek, CEO at REX Shares

"Shelter again was the largest factor in the monthly increase. Excluding shelter, inflation came in much lower at 1.4% from one year ago. This matters because shelter inflation is calculated with a lag. If we exclude shelter, we've had two months of mild deflation. If total spending and nominal wage growth slow down over the next few months as expected, we should expect inflation to continue to fall to the Fed’s 2% inflation target." – Patrick Horan, macroeconomist at the Mercatus Center

"November inflation data came in slightly above expectations but remained in a downward trend. Areas that surprised to the upside included shelter and used cars, but those should be one-offs as private data on apartment rents and wholesale vehicle prices suggest that further disinflation is in store. NAFCU still expects that the FOMC is done hiking rates, and that the first rate cut will come in the second quarter of 2024." – Curt Long, vice president of research and chief economist at the National Association of Federally-Insured Credit Unions

"Markets had a lot of optimism coming into CPI and now they could feel a little bit disappointed. Higher costs for shelter, services and used vehicles suggest the road to 2% inflation might not be as quick as hoped. The trend continues to be lower, but Jerome Powell may not want to rush cutting rates. Today’s inflation report might give investors some pause, given their big gains in recent weeks." –  David Russell, global head of market strategy at TradeStation

"Today's CPI report does not support further interest rate hikes. Inflation is decelerating, albeit slowly. At a time when the labor market is softening, the Fed must maintain its cautious, data-dependent policy posture heading into the new year as it considers lowering interest rates." – Richard Wahlquist, CEO at the  American Staffing Association

"The Consumer Price Index is a momentary respite for small businesses. While this opportunity for a deep breath is welcome, the Freedom Economy Index indicates that there is still inflation-induced pain on Main Street. This isn’t going away any time soon unless the Fed decides to ease up on the high interest rates policy.” – Andrew Crapuchettes, CEO at RedBalloon

"We expect the Federal Reserve to refrain from a rate hike once again, as they’ve expressed optimism that inflation is easing. Despite this encouraging news, Fed Chair Jerome Powell is likely to reiterate that the Fed is prepared to tighten policy further if necessary. Since key areas of the economy, such as the jobs market and GDP, remain strong, we expect interest rates will remain elevated through at least the first half of 2024." – Joe Gaffoglio, president of Mutual of America Capital Management

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Dan Burrows
Senior Investing Writer,

Dan Burrows is Kiplinger's senior investing writer, having joined the august publication full time in 2016.

A long-time financial journalist, Dan is a veteran of SmartMoney, MarketWatch, CBS MoneyWatch, InvestorPlace and DailyFinance. He has written for The Wall Street Journal, Bloomberg, Consumer Reports, Senior Executive and Boston magazine, and his stories have appeared in the New York Daily News, the San Jose Mercury News and Investor's Business Daily, among other publications. As a senior writer at AOL's DailyFinance, Dan reported market news from the floor of the New York Stock Exchange and hosted a weekly video segment on equities.

Once upon a time – before his days as a financial reporter and assistant financial editor at legendary fashion trade paper Women's Wear Daily – Dan worked for Spy magazine, scribbled away at Time Inc. and contributed to Maxim magazine back when lad mags were a thing. He's also written for Esquire magazine's Dubious Achievements Awards.

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Dan holds a bachelor's degree from Oberlin College and a master's degree from Columbia University.

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