US consumer prices rose 0.4% in October, the Bureau of Labor Statistics reported on Tuesday, November 10, coming in hotter than the 0.3% rise economists had forecast. The reading leaves the Federal Reserve on course to raise interest rates at its December meeting, even though the bureau could not publish an annual inflation figure this month.
The October CPI inflation report showed prices still climbing across much of the economy. Shelter costs rose 0.3% and accounted for more than 30% of the month’s increase, while food prices climbed 0.5%. Energy prices rose 0.7%, a sharp slowdown from September’s 5.2% jump.
The numbers behind the October CPI report
The headline index rose 0.4% on a seasonally adjusted basis, easing from September’s 0.6% increase but beating the consensus forecast of 0.3%. Core prices, which strip out volatile food and energy costs, rose 0.3% for a third consecutive month, against a forecast of 0.2%.
| Measure (seasonally adjusted, month on month) | October 2026 | September 2026 | Forecast |
|---|---|---|---|
| All-items CPI | +0.4% | +0.6% | +0.3% |
| Core CPI (ex food and energy) | +0.3% | +0.3% | +0.2% |
| Food | +0.5% | — | — |
| Energy | +0.7% | +5.2% | — |
| Shelter | +0.3% | — | — |
Real average hourly earnings were unchanged from September to October, the bureau reported separately, meaning pay packets kept pace with prices but did not gain ground.
Shelter and food drove the increase
Housing remains the report’s heavyweight. Shelter rose 0.3% in October and contributed more than 30% of the all-items index’s monthly advance, according to the bureau. Food prices rose 0.5%, adding pressure on household budgets ahead of the holiday season.
Energy offered the one real relief. After surging 5.2% in September, energy inflation slowed to 0.7% in October. Even so, the combination of higher shelter and food costs was enough to push the headline figure above forecasts.
Why there is no annual inflation figure this month
Missing from Tuesday’s release was the number most people look for first: the 12-month inflation rate. The bureau did not publish year-over-year readings for most October series because it could not collect consumer price data in October 2025, when a lapse in government funding shut down survey work.
With no October 2025 base to compare against, the bureau has nothing to measure this October’s prices against on an annual basis. Annual figures return with the November report, due December 10. The last published annual readings, from September, put headline inflation at 3.7%.
What the report means for the Fed’s December decision
The hotter-than-expected reading strengthens the case for the Federal Reserve to raise interest rates next month. Fed Governor Christopher Waller said in a speech on Tuesday morning, before the figures were released, that inflation remained too high and that tightening monetary policy was necessary “sooner, rather than later.” He favoured a rate rise in December even if inflation improved.
The central bank held rates steady in October, keeping its target range at 3.75% to 4% in a 10-2 vote on October 28. The next rate decision is due December 9, one day before the November CPI report lands.
Reuters reported that the October figures leave the Fed on course to raise rates next month. The report also complicates the outlook for borrowers, with mortgage rates and other consumer borrowing costs closely tied to the path of Fed policy.
How markets reacted
Stocks had a mixed start after the release. Futures tied to the Dow Jones Industrial Average edged up 0.1%, while Nasdaq 100 futures fell about 0.8% and S&P 500 futures slipped 0.3%. The yield on the 10-year US Treasury note sat near 4.9%.
The cooler open followed Wall Street’s Monday rebound, when the Dow surged more than 1,100 points in its best day since April. Oil prices also fell, with Brent crude down about 3% to $89.88 a barrel and US benchmark West Texas Intermediate below $85.
Investopedia’s market briefing noted that the October CPI data appeared to take some wind out of the morning’s outlook after Monday’s rally.
Frequently asked questions
How much did US inflation rise in October 2026?
Consumer prices rose 0.4% in October on a seasonally adjusted basis, according to the Bureau of Labor Statistics. That was down from 0.6% in September but above the 0.3% economists had forecast.
What is core CPI and how much did it rise?
Core CPI excludes food and energy prices, which swing sharply from month to month. It rose 0.3% in October, the third straight month at that pace, against a forecast of 0.2%.
Why was no annual inflation rate published for October?
The Bureau of Labor Statistics did not collect price data in October 2025 during a lapse in government funding, so there is no base month to compare October 2026 against. Annual readings return with the November report on December 10.
Will the Fed raise interest rates in December?
The October report strengthens the case for a rise. Fed Governor Christopher Waller said tightening was needed “sooner, rather than later” and favoured a December increase. The Fed’s next decision is due December 9.
What drove October’s price rises?
Shelter rose 0.3% and accounted for more than 30% of the monthly increase, while food prices rose 0.5%. Energy inflation slowed sharply to 0.7% from 5.2% in September.
