Monthly Inflation Eases to 0.4% in October as Core Price Pressures Persist
Key Facts
The Consumer Price Index for All Urban Consumers in the United States rose 0.4% on a seasonally adjusted monthly basis in October 2026, after a 0.6% increase in September, according to the Bureau of Labor Statistics. The report came as markets tracked inflation’s effect on the path of interest rates and bond yields, but the headline reading showed a slower pace of monthly gains. By contrast, the core index, which excludes food and energy, rose 0.3% for the third consecutive month. Expectations had been for a 0.2% monthly increase in the core index, according to Reuters. The bureau did not publish the annual rate of change for the October index because October 2025 data were not collected due to a lapse in government appropriations.
The monthly increase was split between a 0.7% rise in the energy index in October, compared with a sharp 5.2% increase in September, and a 0.5% gain in the food index in the same month. The slower energy increase means its monthly contribution was lower than in the previous month, while food continued to rise. The core index’s persistence at 0.3%, despite expectations for a slowdown, kept attention on price pressures outside the more volatile components. The absence of an annual comparison limits the ability to place October’s reading in a direct year-over-year context, according to the Bureau of Labor Statistics. The available report therefore centered on monthly changes and their components.
The core reading renewed focus on the monetary policy path ahead of the Federal Reserve’s December meeting. Governor Christopher Waller said a core increase of 0.3% or higher than September’s could warrant discussion of a stronger move, adding that a 50-basis-point rate increase should be on the table at the December meeting. By midmorning on November 10, market bets on an increase of that size were near 15%, according to Reuters. This coincided with a broad sell-off in the bond market. The 10-year Treasury yield rose to 4.99% from 4.88% late Monday, according to the Associated Press.
The pressure was reflected in U.S. stock trading Tuesday morning, with the S&P 500 down 0.7%, the Dow Jones down 0.6% and the Nasdaq down 0.8% by 10:45 a.m. Eastern time, according to the Associated Press. The index moves coincided with a rise in the 10-year yield and increased market bets on tighter monetary policy. But the data available here do not establish how Upstart stock or other consumer finance stocks moved during the November 10 session. Upstart shares closed at $22.25 on November 9, according to EL7 data. That remains the previous session’s reading, not a price or change recorded during the report’s release session.
The report follows Upstart’s announcement of third-quarter results on November 3, when it posted total revenue of $371 million, up 34% year over year, including record fee revenue of $364 million, up 41%. Loans originated through the platform totaled $4.1 billion, up 44% year over year, with a record 574,089 loans. The company also posted net income of $36.6 million, compared with $31.8 million in the third quarter of 2025, and diluted earnings per share of $0.33 versus $0.23. Despite revenue and loan growth, the company lowered its 2026 revenue outlook to about $1.35 billion from $1.4 billion. It also cut its adjusted EBITDA forecast to $260 million from $294 million.
Chief Executive Paul Gu tied the weaker outlook to macroeconomic effects on balance sheet income, saying borrower conditions and interest rates became a significant headwind in the third quarter and worsened at the start of the fourth quarter. On the earnings call, Gu said annual inflation had accelerated to 3.7% and prices had risen twice as fast as wages in the prior quarter, referring to third-quarter conditions. The 3.7% figure is not the published annual rate of change for October inflation; the bureau did not publish that rate for the month. The company said its average UMI macroeconomic index was 1.50 in the third quarter, compared with 1.41 in the second quarter. It added that the index had risen 14 points since the start of the year to 1.53 at the end of October.
Upstart said it expects to open Upstart Bank in early 2027, subject to completing regulatory approvals. The Bureau of Labor Statistics scheduled the November 2026 Consumer Price Index report for December 10 at 8:30 a.m. Eastern time. The Federal Reserve is scheduled to hold its next meeting on December 8 and 9. These dates follow October’s reading, which showed monthly headline inflation slowing while core inflation held at its pace for the third consecutive month. Markets are watching inflation’s effects on interest rates and bond yields ahead of the meeting.