The U.S. Consumer Price Index (CPI) for increased by 0.3% on a monthly basis in November, according to data released by the Bureau of Labor Statistics, offering further indications that momentum toward lowering inflation has weakened.

November’s uptick, the highest since April, followed a 0.2% rise in each of the previous four months. On a year-over-year basis, the all-items CPI rose 2.7%, marking a slight acceleration from the 2.6% increase recorded in October.

Shelter costs were the largest contributor to November’s monthly increase, rising 0.3% in November to account for nearly 40% of the overall growth. The food index also saw a notable upswing, rising 0.4% over the month. Notably, the food at home index rose 0.5%, the largest increase since January 2023, while food away from home increased by 0.3%. The energy index experienced a modest 0.2% rise, reversing a flat performance in October.

Even excluding volatile food and energy costs, the core CPI still rose by 0.3%, the same monthly increase seen for the past three months. Much of that recent gain can be attributed to increases in vehicle prices, though core goods prices also crept higher on a monthly basis. Over the past year, core inflation is now up 3.3%, up from 4.0% in November 2023, though still hovering around the same range it has now stalled at since midsummer.

Regarding how the new data impacts the result of the upcoming Federal Reserve meeting, Sam Williamson, senior economist at First American, noted that it likely paved the way for the central bank’s decision.

“November CPI data aligned closely with consensus expectations, likely giving the Federal Reserve justification to cut interest rates by 0.25 basis points next week,” he said. However, the pace of rate cuts may slow in 2025 due to strong economic data and ongoing inflation concerns. … Assuming a more gradual pace of rate cuts in 2025, mortgage rates are generally expected to follow a similar path, likely settling in the mid-to-low 6 percent range by year-end.”