Daily Livestock Report reports November CPI data, showing continued easing in U.S. inflation pressures. The Core Consumer Price Index (CPI) rose 2.6 percent year over year, well below market expectations of around 3 percent. While energy and food prices remain notable contributors to inflation, several other components showed meaningful moderation.
Shelter costs, which were a primary driver of inflation earlier this year, increased 3% year over year in November, while new vehicle prices rose just 0.6 percent, signaling broader disinflation across key categories. As a result, market expectations have shifted, with investors now pricing a 96 percent probability of at least one interest rate cut over the coming year and a 78 percent chance of two cuts. Attention is increasingly turning to the labor market, as the unemployment rate has reached its highest level in three years.
Grocery price inflation continues to cool, with food consumed at home rising by less than 2 percent year over year in November. Meat prices, particularly beef remain the most significant contributor to grocery inflation, accounting for more than half of the annual increase in prices. However, this pressure is being partially offset by lower dairy prices and more stable pricing across several center-of-the-store categories. Overall, grocery inflation has remained below both total CPI and foodservice inflation for an extended period.
In contrast, food consumed away from home remains a more significant source of inflation, with restaurant prices increasing at an annual rate of 3.7 percent to 4.0 percent since early 2024. While price growth at limited-service restaurants has slowed toward pre-pandemic norms, full-service restaurants continue to post more substantial increases as operators contend with higher labor costs and elevated beef prices.
Source : iastate.edu