The inflation that won't budge

The November consumer price index delivered another dispiriting confirmation of inflation persistence, with core prices advancing by 0.3 per cent month-on-month for the fourth consecutive print, keeping annual core inflation pinned at 3.3 per cent. Disinflation in the United States has ground to a complete, stubborn halt.

The Autoregressive Stalemate

The persistence is concentrated inside domestic services, auto insurance, and healthcare, where prices are insulated from global goods deflation and track sticky compensation trends. With sequential core inflation compounding at nearly four per cent annualized, the Federal Reserve has zero empirical justification for continuing an aggressive monetary easing campaign. Inflation is simply refusing to budge.

Four consecutive months of 0.3 per cent core inflation prints prove that price pressures have hardened, warning central bankers that further rate cuts risk reigniting the inflationary fire.