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No Data Just Magic

Please consider the Consumer Price Index release for November 2025.

BLS did not collect survey data for October 2025 due to a lapse in appropriations. BLS was unable to retroactively collect these data. For a few indexes, BLS uses nonsurvey data sources instead of survey data to make the index calculations. BLS was able to retroactively acquire most of the nonsurvey data for October. CPI data collection resumed on November 14, 2025.

Despite the lack of data, the BLS did somehow conjure up unadjusted year-over-year changes.

With a bit of magic, ta da …

CPI Year-Over-Year Percent Change

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Ta Da Year-Over-Year Numbers

• CPI: 2.7 percent
• CPI Excluding Food and Energy: 2.6 percent
• Shelter: 3.0 percent
• Medical Care Services: 3.3 percent
• Rent of Primary Residence: 3.0 percent
• Owners’ Equivalent Rent: 3.4 percent
• Food at Home: 1.9 percent
• Food Away from Home: 3.7 percent

The Consumer Price Index for December 2025 is scheduled to be released on Tuesday, January 13, 2026, at 8:30 a.m. (ET).

Hopefully we will have something other than magic.

Thank you for your attention.

Looking Ahead

For 2026, the two key items will be shelter and health care. Shelter will matter more for the CPI. Health care will matter more for the PCE and that is the Fed’s preferred measure of inflation.

The CPI consists of items directly paid by consumers. The PCE includes items paid on behalf of consumers including Medicare, Obamacare, and corporate health care plans.

Medical care costs are going to explode in 2026, even if Congress works out an extension to Obamacare.

I estimate that health care (excluding Obamacare) will add about 1.5 percentage points to the PCE. Factor in Obamacare and the numbers are more like 1.7 or 1.8 percentage points.

For the Fed to hit it’s 2.0 percent target, very little else can go up.

Related Posts

December 8, 2025: Health Care Inflation Bomb Makes the Fed’s 2 Percent Target Almost Impossible

Let’s discuss 2026 health care premiums and what they mean to the Fed’s preferred measure of inflation.

December 9, 2025: How Much Will 4.5 Million Florida Residents Pay for Obamacare in 2026?

Here’s some interesting health care math on Obamacare in Florida.

Good Morning America!

Healthcare is now approximately 16.66 percent of the entire PCE basket, much larger than all durable goods combined, and only 1.5 points behind housing.

2026 medical-cost trends are running 8.5 percent to 9.5 annual percent increases. Those projected increases will add 1.4 to 1.6 percentage points to headline PCE inflation before food, energy, shelter, or tariffs move prices at all.

This ignores the huge Obamacare impact on 1 out of 6 people.

The only way to hold the line on PCE is if the price of rent crashes or a strong recession cuts demand for all other goods and services.

I run through some options in the above links.

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