Why are economists surprised by the latest US inflation numbers?

Economists are surprised because the November inflation figures were lower than anticipated, especially given previous concerns about tariffs potentially driving up prices.

What is Core CPI and why is it important for understanding inflation?

Core CPI excludes volatile food and energy prices, providing a clearer view of underlying inflation trends and consumer spending patterns.

How might the current inflation data affect interest rates?

Softer inflation data could lead investors to anticipate potential interest rate cuts, as it suggests less pressure on the economy.

Home / Business and Economy / Trump's Tariffs: Inflation Number Defies Expectations

Trump's Tariffs: Inflation Number Defies Expectations

20 Dec, 2025

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Summary

November's Consumer Price Index rose 2.7% year-over-year.
Core CPI, excluding food and energy, also decreased.
Economists and reporters expressed surprise at the data.

Trump's Tariffs: Inflation Number Defies Expectations

The latest consumer price index report presented a surprising decline in inflation, defying earlier predictions that President Donald Trump's tariff policies would lead to significant price increases. The overall CPI saw a 2.7% rise year-over-year in November, a decrease from previous months. Core CPI, which omits volatile food and energy costs, also showed a similar downward trend.

This softer inflation data caught many analysts off guard. Prominent economic reporters and Harvard economist Ken Rogoff acknowledged their surprise, as the numbers came in lower than expected. This unexpected economic performance offers a more positive signal for investors and the broader economy.

The reduction in inflation provides a counterpoint to earlier criticisms of the administration's trade policies. The positive economic signal is likely to be viewed favorably by the president and may influence investor expectations regarding future interest rate adjustments.