By Jake Conley

Inflation pressures eased more than expected in November, according to the latest data on consumer prices published by the Bureau of Labor Statistics on Thursday.

The Consumer Price Index (CPI) rose 2.7% over the prior year in November, less than the 3.1% increase that had been expected by economists, according to Bloomberg estimates.

On a "core" basis, which strips out the more volatile costs of food and energy, prices rose 2.6% over the prior year in November. Economists had also expected to see a 3.1% increase in core prices.

The data marked the first inflation reading since November, with October's report canceled as a result of the government shutdown. This also meant Thursday's report offered no month-on-month comparisons for consumer prices.

In September, the last month for which there is inflation data, both the headline and core CPI measures rose 3% from the same month last year.

Read more: How to protect your savings against inflation

Thursday's report should also mark the final time major economic data, notably the monthly jobs report and inflation data, is published on an altered schedule following the government shutdown that lasted 43 days earlier this year.

The November jobs report was released on Tuesday, showing more jobs were created last month than expected, while the unemployment rate hit a four-year high. The December jobs report is set for release on Jan. 9, 2026, returning to its typical spot on a Friday morning.

"Inflation is still above target ... but this should be temporary," said Jeffrey Roach, chief economist for LPL Financial. "As demand cools in the coming months, pricing pressures should ease, giving investors some breathing room."

The Federal Reserve targets 2% inflation, as measured by the core personal consumption expenditures (PCE) index, which is released by the Bureau of Economic Analysis in the final week of each month. The latest core PCE data, which was collected in September and released earlier this month, showed prices rose 2.8% over the prior year.

Economists at Bank of America wrote in a report ahead of Thursday's CPI release that goods inflation should "remain sticky owing to tariffs," while services "should be softer driven in part by health insurance."

This push-pull dynamic within the inflation data is likely to keep the Fed on the sidelines at the end of its January meeting, with traders currently pricing in a roughly 25% chance the central bank cuts rates next month.

Last week, the Fed's forecasts suggested it would cut rates only one more time in 2026 after cutting rates by 0.25% at three straight meetings to end 2025.

Read more: How jobs, inflation, and the Fed are all related

Federal Reserve Chair Jerome Powell speaks during a press conference following the Federal Open Markets Committee meeting at the Federal Reserve on December 10, 2025 in Washington, DC. (Photo by Chip Somodevilla/Getty Images)

Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com.