US consumer prices increase strongly for third straight month in October
TLT•The US Consumer Price Index rose 0.4% in October, above economists’ 0.3% forecast, while core CPI increased 0.3% for the third straight month. Markets priced in an roughly 89% chance of a 25-basis-point Fed rate hike next month.
1. Prices rise more than expected
The Consumer Price Index rose 0.4% in October after advancing 0.6% in September, marking the third consecutive month of gains of 0.4% or more. Economists had forecast a 0.3% increase. Shelter costs rose 0.3% and accounted for more than 30% of the monthly CPI increase, while food prices climbed 0.5%.
2. Core inflation stays firm
CPI excluding food and energy increased 0.3% for the third month in a row, above the 0.2% forecast. The Bureau of Labor Statistics did not publish year-over-year inflation figures because last year's government shutdown prevented October 2025 data collection. Financial markets priced in an approximately 89% chance of a 25-basis-point rate hike next month; US Treasury yields rose and stocks opened lower.
