Inflation cooled in November, but data may be distorted

"Thursday's report gave investors, businesses, and policymakers their first look at CPI since the September numbers were released on Oct. 24. Consumer prices had risen 3% in September from a year earlier, and forecasters had expected the November CPI to match that year-over-year increase."

"'It's likely a bit distorted,' said Diane Swonk, chief economist at the tax and consulting firm KPMG. 'The good news is that it's cooling. We'll take a win when we can get it.' Still, Swonk added: 'The data is truncated, and we just don't know how much of it to trust.' By disrupting the economy - especially government contracting - the shutdown may have contributed to a cooling in prices, she said."

The Labor Department reported that the consumer price index rose 2.7% in November from a year earlier, down from a 3% year‑over‑year increase in September. The November CPI release was delayed eight days by a 43‑day federal shutdown, which also prevented the department from compiling overall October consumer price and core inflation numbers and disrupted data collection. Economists warned the delayed and truncated data may be distorted and urged caution in interpretation. Many Americans continue to feel the effects of high prices for food, insurance, utilities, and other basic necessities despite the slowdown in headline inflation.

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