Investing.com -- US consumer prices increased slightly on an annualized basis in November, but the in line figure has largely cemented expectations for another interest rate cut by the Federal Reserve next week.
The Labor Department's consumer price index (CPI) rose by 2.7% last month, as expected, accelerating slightly from 2.6% in October.
Month-on-month, the reading climbed to 0.3%, again as expected, above the 0.2% the prior month.
Stripping out more volatile items like food and fuel, the "core" number climbed by 3.3% in the twelve months to July, a;lso in line with expectations, while on a monthly basis, underlying price growth inched up to 0.3%, unchanged from October.
The Federal Reserve has cut interest rates by 75 basis points since September, and markets were widely expecting another 25-bps cut at the December 17-18 meeting.
In their latest quarterly projections, released in September, members of the rate-setting Federal Open Market Committee held a median view of the central bank's benchmark rate ending 2025 at 3.4%, or 125 bps of cuts from current levels.
“While some key sources of inflationary pressure, such as an overheated labor market, continue to dissipate,new headwinds to disinflation have emerged (e.g., the potential for tariffs and tax cuts) that make the final leg of inflation's journey back to the Fed's 2% target look increasingly difficult,” said analysts at Wells Fargo (NYSE: WFC ), in a note.