An unexpected decline in U.S. inflation data on Thursday could pave the way for the Federal Reserve to continue cutting interest rates next year.
The consumer price index (CPI) rose by 2.7%. That increased year over year in November, according to a report released Thursday by the U.S. Bureau of Labor Statistics. Economists had expected growth of 3.1%, compared with the previous forecast of 3%.
Core CPI (excluding food and energy) rose 2.6%, compared with the previous forecast of 3% and 3%.
Monthly data were not included as U.S. Bureau of Labor Statistics statisticians continue to be affected by the government shutdown in October.
The market reacted quickly. Use Bitcoin It added about 0.5% to its earlier gains and is now back above $88,000. U.S. stock index futures also extended earlier gains, with the Nasdaq 100 currently up 1.15%. The 10-year Treasury yield fell two basis points to 4.12%.
Before the data was released, markets were pricing in a 73% chance of the Fed keeping interest rates unchanged at its January meeting, according to the CME FedWatch tool.
