November’s Consumer Price Index rose just 2.7% year-over-year, far below the anticipated 3.1%, sending stocks soaring and the White House into celebration mode.
The unexpectedly tame reading arrived mere hours after President Trump declared in a national address that inflation had stopped, prompting his team to flood social media with triumphant updates.
The report lifted markets on Thursday, with the relief extending into Friday, as investors savored the lower-than-expected figures.
Wall Street’s enthusiasm proved contagious, though perhaps premature, given the data’s unusual circumstances.
White House press secretary Karoline Leavitt promised Americans could expect continued lower prices and bigger paychecks into the new year.
Her optimism echoed the administration’s rapid response, with one official account posting about the numbers 14 times in the first two hours after release.
National Economic Council director Kevin Hassett called it an “absolute blockbuster report,” noting most economists had misjudged the outcome.
Yet not everyone joined the festivities.
Economists pointed out the report’s quirks, stemming from the recent lengthy government shutdown that canceled October’s data entirely and delayed November’s collection.
Without month-to-month comparisons, the numbers lacked their usual clarity.
Fitch Ratings’ Olu Sonola described it as positive overall but less detailed than normal.
He suggested waiting for next month’s figures for a reliable trend.
RSM’s Joe Brusuelas urged caution in policy or investment decisions based on this single, disrupted reading.
Many experts suspected the low print might reflect timing quirks, like more prices captured during late-month sales.
Shelter costs, a major component, showed unusually slow growth, raising eyebrows among analysts.
The day before the release, President Trump had addressed affordability concerns, blaming prior administration policies for lingering high costs.
He highlighted improving real wages, which have risen steadily since 2022 according to Federal Reserve data.
Less emphasized this week were recent Labor Department figures showing unemployment climbing to 4.6%, a four-year high.
The president announced new “warrior dividend” checks for military members to ease financial pressures.
His affordability-focused stops continue, with a North Carolina event scheduled for Friday.
Vice President JD Vance, touring Pennsylvania, graded the economy an enthusiastic “A-plus-plus-plus.”
As the administration spotlights wage gains outpacing inflation in many metrics, shoppers might still notice beef and electricity bills telling a different story.
The debate over whether this cooler inflation signals a genuine trend or a statistical hiccup promises to heat up.
For now, the White House enjoys the headline win, while economists politely suggest keeping the champagne on ice until December’s data arrives.
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