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WASHINGTON -- U.S. inflation was higher than expected last month as the rising prices that powered sweeping Democratic victories in last week's midterm elections appear likely to pose ongoing challenges for the White House and the Federal Reserve.
The consumer price index rose 0.4% from September to October, the Labor Department said Tuesday, down from 0.6% the previous month. The government did not report a yearly inflation rate because last year's government shutdown meant no data was released for October 2025.
But excluding the volatile food and energy categories, core prices rose 0.3%, the same as the preceding month. Both figures were a tenth of a point higher than forecast, and at an annual rate would be well above the Fed's 2% target.
The new inflation data heightened concerns that strong consumer and business spending, combined with higher gas prices and supply disruptions stemming from tariffs and global turmoil, are creating increasingly stubborn inflation that could extend beyond temporary spikes in prices at the gas pump. The economy expanded at a 3.4% annual rate in the July-September quarter, mostly driven by consumer spending.
"It's worrisome. There is a sense that inflation is broad, persistent, a little bit everywhere," said Riccardo Trezzi, founder of Underlying Inflation, a consulting firm, and a former Fed economist. "The Fed should be very worried."
Using rough estimates for last October's data, Trezzi calculates that consumer prices rose 4% in October from a year ago, up from 3.7% in September. Core prices rose 2.8%, he estimates, up from 2.6%.
Americans' struggles with high prices were evident as they ousted Republican majorities from the House and Senate last week. With historic gains in both chambers, Democrats in Congress will soon face the same challenges. President Donald Trump has acknowledged voter anger over the Iran war and gas prices but has shown no sign yet of changing course.
The AP Voter Poll, a survey of 100,000 voters, found about two-thirds blamed Trump's policies for higher costs. About 9 in 10 said the cost of living was a "crucial" or "major" factor in their vote.
Fed may become more aggressive
The persistence of elevated inflation makes it highly likely that the Fed will raise its key interest rate at its next meeting in December. It kept rates unchanged late last month, after raising them in September. The Fed increases borrowing costs in an effort to cool spending and bring down inflation.
Earlier Tuesday, Fed governor Christopher Waller, an outspoken member of the central bank's rate-setting committee, said that a hike of a half-point next month was possible, double the size of the usual quarter-point increase.
"Economic activity is strong, the labor market is stable, but inflation is too high, well above" the Fed's 2% goal, Waller said.
Stock prices fell in early trading Tuesday, and Treasury yields rose, on expectations of more persistent inflation and higher rates from the Fed.