October Inflation Rises 0.4%, Exceeding Forecasts and Lifting Dollar and U.S. Bond Yields
Key Facts
The U.S. consumer price index rose 0.4% in October 2026, exceeding the 0.3% increase forecast in a Reuters poll, according to a Reuters report published on November 10. The core index, which excludes food and energy, rose 0.3% for the month. The stronger-than-expected reading refocused attention on the inflation outlook ahead of the Federal Reserve’s December meeting. The Reuters report said the dollar rose against major currencies after the data were released. U.S. Treasury yields also climbed, in a reaction that reflected a shift in monetary policy pricing.
The dollar index rose 0.51% to 102.20, according to the Reuters report on trading on November 10. EL7 daily data showed the index closed at 102.15 that day, compared with a close of 101.54 on November 9. In the currency market, the euro’s close against the dollar fell to 1.11647 on November 10 from 1.12238 in the previous session. Silver also ended trading at $51.371 an ounce, compared with $53.246 on November 9. These closing levels place the assets’ moves across the two sessions in the context of the U.S. reading, while the Reuters report did not attribute silver’s move to a specific cause.
The yield on two-year U.S. Treasuries rose 19.07 basis points to 4.738% in trading on Tuesday, November 10, Reuters reported. The report also said markets priced in an 89% probability of a rate increase in December that day, according to the CME FedWatch tool. It linked the rise in the dollar and yields to the release of the above-forecast inflation reading. Market pricing shows investors raised their estimate of the likelihood of monetary tightening at the next meeting. That percentage remains a reading of prices at the time of the report, not a decision by the Federal Reserve.
October’s increases were spread across major components of the price basket: the food index rose 0.5%, while the energy index increased 0.7%, according to the U.S. Bureau of Labor Statistics. The energy gain was well below its 5.2% increase in September. Meanwhile, the core index recorded a monthly increase of 0.3%, providing a separate view of prices after excluding food and energy. These figures coincided with a 0.4% rise in the overall consumer price index in October. The components provide details on the sources of the month’s increase, without changing the fact that the headline figure exceeded the Reuters poll forecast.
The move extended into the Wednesday, November 11 session, with the dollar index rising 0.2% to 102.4, according to a Reuters report published by Investing.com. The euro fell to $1.114 after dropping more than 0.5% in the previous session, the same report said. In oil, Reuters reported that prices rose about 1% on Wednesday after touching their lowest levels in two months during the previous session. The report said hopes for de-escalation coincided with concerns about attacks on shipping in the Strait of Hormuz. On November 10, U.S. Secretary of State Marco Rubio said Washington had pressed other countries to help protect shipping from Iranian attacks, while acknowledging no progress on the issue with his counterparts in the Group of Seven.
The U.S. Energy Information Administration has scheduled the release of its weekly petroleum status report for Thursday, November 12, at 12 p.m. Eastern time. The release covers data for the week ended November 6 and was scheduled in line with the calendar around the Veterans Day holiday. The report is a near-term focal point for the oil market following Wednesday’s price move and concerns about shipping in the Strait of Hormuz. The U.S. Bureau of Labor Statistics has scheduled the next U.S. inflation data, for November, for release on December 10, 2026, at 8:30 a.m. Eastern time. These dates mark upcoming data releases that markets may monitor when assessing energy prices and inflation.