A worker stocks Angus beef top sirloin fillets in the meat section of a Washington, D.C., grocery store.
Tom Williams | Cq-roll Call Inc. | Getty Images
Inflation unexpectedly slowed in November as a slowdown in various consumer products outweighed price pressures in categories such as gasoline, but economists said the numbers should be interpreted with caution due to uneven data collection during the government shutdown.
The Consumer Price Index, a key barometer of inflation, rose 2.7% in November from a year earlier, the Bureau of Labor Statistics said Thursday.
This was slower than expected and slowed from the 3% inflation rate in September, the last month for which data was available.
“Inflation has come down quite sharply,” said Thomas Ryan, North American economist at Capital Economics.
“(But) to be honest, I think some of these numbers are a little questionable,” he said. “It was a different month than usual.”
First CPI report after shutdown
The CPI report released Thursday was the bureau’s first since the record-long government shutdown ended last month.
The BLS did not collect inflation data for October and was only able to collect data for about half of November due to the government shutdown that lasted from October 1st to November 12th.
Economists say this will give the public an incomplete picture of consumer price developments in recent months.
It’s also possible that certain data readings are skewed. For example, the government’s data sample was taken in mid-to-late November, Ryan said, so product prices may have unintentionally captured more Black Friday sales and appeared artificially lower.
Inflation in so-called “core” goods (in kind, excluding food and energy) fell to 1.4% in November from 1.5% in September, the bureau said in a report.
Many economists had predicted that the Trump administration’s tariff policies would continue to put upward pressure on prices through at least the middle of next year.
“Given these technical issues that we’re discussing, I think the results should definitely be taken with a grain of salt,” said Tom Porcelli, chief economist at Wells Fargo. “That’s a very sloppy report.”
Prior to November’s data, inflation had been steadily rising from 2.3% in April.
If you take this CPI report at face value, “inflation appears to be coming down again,” Ryan said.
If this trend continues, it will be good for consumers’ wallets, as price growth will slow and wages will generally increase after accounting for inflation, Ryan said.
It would also allow the U.S. central bank, the Federal Reserve, to cut interest rates next year, potentially relieving some pressure on debtors, he said.
But some economists are skeptical about the trajectory of inflation.
“Once all the dust settles, the story about inflation is not really moving that much,” Porcelli said.
Joe Seidle, senior market economist at JPMorgan Private Bank, said Fed policymakers appear to be focusing less on inflation and more on the labor market, which is showing signs of cooling.
“I think inflation has taken a backseat to labor market statistics,” Seidl said.
Seidl said lower wages would also put downward pressure on inflation in the service sector, as the sector tends to be more sensitive to labor costs.
Slower inflation doesn’t mean more affordable
Furthermore, economists said falling inflation is not the same as falling prices.
Seidl said that while inflation refers to the rate of change in prices, affordability is more related to the actual price level.
A University of Michigan consumer sentiment survey conducted in November revealed that households are increasingly dissatisfied with high prices. According to the survey, the percentage of consumers who spontaneously mentioned the negative impact of high prices on their personal finances rose from 34% in January 2025 to 47% for the fifth consecutive month.
“Although the rate of change is slowing, price levels continue to rise and that’s what people are feeling,” Porcelli said.
He said food is one of the major categories where consumers are feeling price pressure.
Beef prices are soaring as the supply of cattle reaches its lowest level since the early 1950s in 2025. The annual inflation rate for raw beef roasts was about 21% in November, according to the CPI report.
Coffee prices have also increased by about 19% from a year ago, due to abnormal weather in major coffee producing countries and tariffs imposed on Brazil by the Trump administration.
Banana prices have also increased by about 7% over the past year.
“Food is a category that most people feel about on a daily basis,” Porcelli says. “A lot of it has to do with tariffs.”
But President Donald Trump last month exempted certain agricultural imports, including beef, coffee, cocoa and bananas, from the tariffs after political backlash over affordability. It is unclear whether this will immediately ease the rise in food prices.
