What's Up with Prices? November's Inflation Report Drops Thursday

Thursday is a big day for economists and folks keeping an eye on their wallets. That's when the latest inflation report comes out, giving us a peek at how much prices have changed. This is the first time in almost two months we're getting fresh data, thanks to that long government shutdown messing things up. Prices have been creeping up lately, and experts think this trend will keep going. They're predicting a small jump in inflation from 3% in September to 3. 1% in November. Some of the biggest price changes have been in everyday items like coffee, beef, and eggs. Coffee prices shot up nearly 19% in September, and beef wasn't far behind with a 15% increase. But not everything got more expensive—eggs actually got cheaper, dropping nearly 5%. The government will also release some price data for October, but don't expect the full picture. The shutdown messed up their data collection, so we won't know the overall price increase for that month. This report is coming at a tricky time for the U. S. economy. Hiring has slowed down, and inflation is still high. Earlier this week, two big reports raised some red flags.The U. S. only added 64, 000 jobs in November, which is a big drop from the 119, 000 jobs added in September. The unemployment rate also ticked up to 4. 6% in November from 4. 4% in September. That's still low compared to history, but it's the highest it's been since 2021. Retail sales didn't move at all in October compared to September, which is weird since the holiday season usually boosts spending. Last week, the Federal Reserve cut interest rates by a quarter of a percentage point to try and help the sluggish job market. This was the third rate cut this year, bringing the benchmark rate to between 3. 5% and 3. 75%. Interest rates are still way higher than they were at the start of the COVID-19 pandemic, but they've dropped a lot from their peak in 2023. The Fed is in a tough spot. They have to balance keeping inflation in check while also trying to maximize employment. Their main tool for this is interest rates. Fed Chair Jerome Powell said last week that there's no easy way out of this situation. "There's no risk-free path for policy as we navigate this tension between our employment and inflation goals, " he said.