CPI report today: What is current US Fed interest rate? Will inflation data force US Fed to go for interest rate hike?

US Fed interest rate hike is likely with US consumer prices increasing more than expected in October. The Consumer Price Index rose 0.4 per cent last month after advancing 0.6 per cent in September, the Labor Department's Bureau of Labor Statistics said on Tuesday. This may leave the Federal Reserve on course to raise interest rates next month, as per reports.

US Federal Reserve left its benchmark overnight interest rate in the 3.75 per cent-4.00 per cent range last month.

Inflation Report


Inflation is running well above the US central bank's 2 per cent target. The US-Israeli war with Iran has boosted oil prices, combining with the import tariffs implemented by the Trump administration last year to lift the cost of living.

Excluding the volatile food and energy components, the CPI increased 0.3 per cent last month after gaining 0.3 per cent in September. The so-called core CPI was forecast to have climbed 0.2 per cent in October.

The BLS did not publish year-over-year inflation readings because last year's federal government shutdown prevented the collection of consumer price data in October 2025, leaving no comparison base. Annual consumer inflation jumped 3.7 per cent in September. The missing data from last year have no impact on the calculation of the Personal Consumption Expenditures Price Index readings that are tracked by the Fed to gauge progress toward its inflation target. Both measures are running above 3 per cent.

US Fed Interest Rate Hike

Futures that settle to the Fed's policy rate are pricing about a 85 per cent chance that the central bank will raise the policy rate by 25 basis points next month and a 15 per cent chance of a 50-basis-point rise, according to CME FedWatch data.

Early on Tuesday, financial markets fully priced in a 25 basis points rate hike next month.

Economists said only a substantial sell-off on the equity markets or widening credit spreads would prevent the Fed from tightening monetary policy in December. US stocks slumped last week after the Democrats' sweeping victory fanned fears that new regulations could dent the durability of the AI trade. Stocks rallied on Monday as oil prices fell.