Updated

U.S. consumer prices rose 0.4% from September to October, higher than economists expected, according to a Labor Department report released Tuesday. Core prices, excluding food and energy, rose 0.3%, also a tenth of a point above forecasts. The rising prices helped power Democratic victories in last week's midterm elections and are likely to challenge the White House and the Federal Reserve. The government did not report a yearly rate because last year's shutdown meant no October 2025 data was released. Riccardo Trezzi, a former Fed economist, told the AP that inflation looked broad and persistent, and he estimated the annual rate at about 4%. Gas prices rose 1% in the month but have soared more than 37% from a year ago, and higher energy costs are spreading to air fares, electricity, groceries, restaurants and streaming services. Fed governor Christopher Waller said a half-point hike at the December meeting was possible, and the AP said a rate increase there looked highly likely. AI-driven demand has also pushed up prices for computer chips, electricity and electronics, with computer prices up nearly 10% in the year ending in September. Small businesses such as National Tree Company, an artificial tree importer, report customers pulling back on spending and firms facing higher diesel and tariff-related costs.