18 December 2025
If you are covering the latest US inflation data, please see the following comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
“Today’s long awaited US CPI print has come in cooler than had been expected. While headline and core inflation each rose by 0.2% in the two months from September to November 2025, the annual rates fell considerably. The headline rate for the 12 months to November fell to 2.7%, down from 3.0% in the 12 months to September, while core inflation dropped to 2.6% from 3.1%.
“With no October comparator, as well as the delay to November’s data collection due to the prolonged government shutdown, today’s figures will need to be taken with a pinch of salt. Regardless, the data out this week will paint the clearest picture of the economy we’ve had for several months and will be key to the Federal Reserve’s decision making in the coming months.
“Jobs data out earlier this week saw heavily subdued payrolls numbers and an uptick in unemployment to 4.6%, and GDP data due out next Tuesday will show how the economy is faring. While current expectations are for just one or two rate cuts in 2026 given the majority of FOMC members appear comfortable that interest rates are close to a ‘neutral’ level, should data projections change then they may be forced to reassess.
“As we move into 2026, all eyes will be on the dynamics of the FOMC – particularly with Trump piling on the pressure for more cuts. With the president determined to appoint a chair who follows his lead on pushing for lower interest rates, markets will be on high alert for any erosion of Fed independence.”
