Wall Street Watches First Post-Shutdown Inflation Reading for Clues on 2026 Outlook

The Bureau of Labor Statistics is scheduled to publish the November 2025 consumer price index on Thursday, delivering the first official inflation reading since the 43-day federal shutdown concluded in mid-November. Market participants view the release as a key data point for gauging economic momentum heading into 2026 and for assessing the Federal Reserve’s next steps on interest rates.

What economists expect

A Dow Jones survey shows economists predicting a 12-month increase of 3.1 percent in the headline CPI, which captures the average price change for a broad basket of goods and services. Excluding the more volatile food and energy components, core CPI is forecast to register a 3.0 percent annual gain.

José Torres, senior economist at Interactive Brokers, anticipates a slightly softer outcome. He projects both headline and core inflation at 2.9 percent, although he acknowledges the headline figure could land anywhere between 2.9 percent and 3.1 percent. Should the report fall below the 3 percent threshold, Torres argues that equity markets could enter the final weeks of the year with a tailwind, potentially setting the stage for a so-called “Santa Claus rally.” He also believes a sub-3 percent print would reinforce expectations for multiple interest-rate cuts in 2026; the Fed currently signals only one reduction next year.

Data complications from the shutdown

The November figures arrive under atypical circumstances. Because the government was shuttered from 1 October through 12 November, the Bureau of Labor Statistics canceled the October inflation report and only managed to release the September data during the stoppage. September CPI showed year-over-year headline and core readings of 3.0 percent, marking the last available snapshot before operations were interrupted.

When President Donald Trump signed a funding bill on 12 November, the BLS resumed its activities but had already missed nearly half of the November survey window. As a result, the agency has stated that Thursday’s publication will omit the standard one-month percentage changes that normally compare prices with the prior month. Instead, the report will focus on the 12-month comparison, because October data were never collected.

Victoria Fernandez, chief market strategist at Crossmark Global Investments, cautions that these gaps complicate interpretation. “This is not going to be a clean CPI number,” she said, noting that price patterns in the second half of a month may differ from those in the first half. Fernandez does not expect a swing of 0.1 percentage point in either direction to trigger a pronounced market move, and she argues that Federal Reserve officials will likely remain in wait-and-see mode even if inflation slips to 2.9 percent.

Broader economic cross-currents

Despite the persistent focus on inflation, Fernandez points to a broader set of indicators that present a mixed picture. Unemployment trends, household income growth, and consumer spending have shown signs of softening, yet analyst forecasts still call for 14 percent earnings growth in 2026. “All the puzzle pieces don’t quite fit together,” she said, underscoring the need for additional data before drawing conclusions about longer-term economic prospects.

For investors, Thursday’s release will provide one of the final major inputs ahead of year-end portfolio positioning. A reading that begins with a “2” would symbolize incremental progress toward the Federal Reserve’s 2 percent target and could reinforce wagers on looser policy next year. Conversely, an outcome at or above 3.1 percent may strengthen confidence in the central bank’s more cautious stance.

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The November CPI will also offer fresh insight for sectors sensitive to interest-rate expectations, including financials, real estate and consumer-discretionary shares. Bond markets are watching closely as well; Treasury yields have fluctuated in recent weeks on shifting perceptions of how quickly inflation might cool and how soon the Fed could begin easing.

Next steps

The Federal Open Market Committee’s first meeting of 2026 is scheduled for late January, leaving officials with limited additional data before they convene. Thursday’s inflation report, December’s employment numbers and fresh readings on retail sales will therefore carry outsized importance for policymakers attempting to balance inflation risks against signs of slowing growth.

Detailed methodology notes for Thursday’s CPI release can be found on the Bureau of Labor Statistics website, which explains how price data are collected and adjusted.

Until more comprehensive figures become available, analysts expect financial markets to trade on incremental updates and to reassess positions as each new data point emerges. The November CPI will serve as a crucial marker in that sequence, but many observers caution that a single release—especially one produced under unusual conditions—may not settle the debate about inflation’s trajectory in 2026.

Crédito da imagem: Spencer Platt | Getty Images