U.S. headline inflation likely to have accelerated in November

The U.S. headline inflation is expected to have accelerated in the month of November on a year-on-year basis. According to a TD Economics research report, the CPI inflation is likely to have firmed to 2.3 percent year-on-year in November, with prices up 0.4 percent on a sequential basis.

Energy prices are likely to be a net positive, aided by increased prices of gasoline, while continued soft rises in food prices cannot be excluded. However, base effects for food prices continue to indicate towards a year-on-year acceleration.

The core inflation rate, which excludes food and energy, are expected to have come in at a sequential rise of 0.2 percent. Core goods prices are expected to be the key driver, which in the earlier month had recorded its first sequential rise since January.

“We believe another m/m gain is possible on the back of firming import prices, keeping the core inflation rate stable at 1.8 percent y/y”, added TD Economics.

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