November’s inflation report is the first to be released after the shutdown

Wall Street is awaiting Thursday’s release of the November consumer price index report, as it will mark the first reading for the period since the record-setting U.S. government shutdown ended last month.

According to economists surveyed by Dow Jones, the report – which tracks the average change in prices people pay for a range of goods and services – is expected to show a 12-month inflation rate of 3.1%. When excluding food and energy, core CPI is forecast to post an annual rate of 3.0%.

The Bureau of Labor Statistics has said the release “will not include 1-month percent changes for November 2025 where the October 2025 data are missing,” as the agency canceled the October inflation report in late November, weeks before the Federal Reserve’s final meeting of the year. September’s CPI data – the most recent CPI report to be published and only piece of economic data released during the shutdown – showed an annual reading of 3.0% for the headline and core measures.

“The psychological distinction between a two handle and a three handle is going to be paramount,” José Torres, senior economist at Interactive Brokers, said in an interview with CNBC.

While the consensus estimate shows the annual rate hitting the 3% threshold for the month, the senior economist is anticipating the headline and core readings to be lower than expected at 2.9% each, though he thinks that the range of possible outcomes for headline could be between that figure and 3.1%.

If the report were to show a 2.9% reading, it could offer some positive momentum in stocks heading into 2026. In fact, Torres believes that such a number would clear the path for a so-called Santa Claus rally. He also thinks it would have an impact on the interest rate outlook for next year – a period during which the Fed projects one rate cut.

“It really would strengthen monetary policy easing expectations in the last inflation report – CPI report – of 2025 if we could keep inflation in the twos rather than it increasing up to the threes, because that’ll allow more interest rate cuts next year,” Torres added.

While the release could help pave the way for a year-end rally, there would need to be other catalysts in store for that to happen, because others like Victoria Fernandez of Crossmark Global Investments don’t see a 0.1 percentage point move in either direction as leading to some “huge” market reaction. She also thinks that Fed policymakers would still be in wait-and-see mode even with a 2.9% reading.

“I think it’s going to be varied. This is not going to be a clean CPI number,” the firm’s chief market strategist said, citing the absence of month-over-month data as one factor and when exactly the BLS was able to begin collecting the November data as another.

President Donald Trump officially signed a funding bill into law on Nov. 12, reopening the government after 43 days of stoppage – the longest duration in U.S. history. That prompted the BLS to push back November’s CPI report from its previously scheduled release date of Dec. 10.

“By the time the government actually opened and they started collecting data, we were almost halfway through the month of November, so you’re only getting the last half of the month,” Fernandez said. “You have to start wondering, ‘Is there some kind of a bias in terms of what prices do and how things work in the latter half of the month versus the beginning of a month?'”

Ultimately, the strategist thinks the overall theme will be that inflation is “remaining high” and that it’s not making its way back towards 2% like some anticipate.

“We have a tremendous amount of uncertainty as to where we’re going from here, because we have conflicting stories,” Fernandez said. “We can have weak trends in unemployment, weak household income, consumer spending weak, and then we can have the expectation of 14% earnings growth next year and strong revenues. All the puzzle pieces don’t quite fit together.”

“We just need more information before we can make a true statement as to what the long term is going to look like,” she continued.