Bank of America kept its forecast for a 25-basis-point rate increase at the Federal Reserve’s December meeting but saw a 50-basis-point move as possible after October’s core inflation reading, Investing.com reported.
The U.S. Bureau of Labor Statistics (BLS) said the Consumer Price Index (CPI) rose 0.4% in October from the prior month on a seasonally adjusted basis, following a 0.6% increase in September. Core CPI, which excludes food and energy, rose a seasonally adjusted 0.3% for a third consecutive month. Reuters reported that economists it surveyed had expected gains of 0.3% for headline CPI and 0.2% for core CPI.
Investing.com said its account was based on a Bank of America client note. The outlet quoted the note as saying the October figures “open the door to a 50bp move.” It also reported that the bank saw a growing risk of another increase in January rather than March.
Before the CPI release, Federal Reserve Gov. Christopher J. Waller described a quarter-point increase as his current direction. He said a core reading around 0.3% or higher would put a half-point increase under consideration. The reading matched the level in Waller’s pre-release remarks, which EconoTimes covered in an earlier report on his view of a possible half-point move. Waller said his views did not necessarily represent those of his Federal Reserve Board or Federal Open Market Committee (FOMC) colleagues.
On Oct. 28, the FOMC kept its target range at 3.75% to 4.00%. The 10-2 vote included FOMC members Lisa D. Cook and Beth M. Hammack, who preferred a 25-basis-point increase.
A lapse in appropriations meant BLS did not collect October 2025 survey data for most CPI series. The agency said it therefore could not publish October 2026 12-month changes for indexes missing those comparison data.
The FOMC is scheduled to meet Dec. 8-9. BLS has scheduled the November CPI report for Dec. 10 at 8:30 a.m. ET.
