In a development that has energized the White House and the markets alike, inflation cooled more than expected in November, handing President Donald Trump a much-needed economic win as he intensifies his messaging ahead of the 2026 midterm elections. According to Thursday’s Consumer Price Index (CPI) report, prices rose just 2.7% year-over-year—a notable drop from September’s 3% figure and the lowest inflation rate since June.
The 2.7% reading not only beat economists’ predictions—many expected inflation to tick back up above 3%—but also offered political momentum to the Trump administration, which has made economic recovery and price stabilization a central theme of its post-pandemic policy narrative.
“This is a major step forward,” said Labor Secretary Lori Chavez-DeRemer, attributing the trend to “pro-worker economic policies” championed by the Trump administration. In a post on X, she noted: “The facts are clear: President Trump is making progress to fix the affordability crisis caused by Biden and deliver relief for hardworking Americans.”
The report highlighted another key signal: core services inflation—a metric that excludes volatile housing and energy prices—also fell to 2.7%, its lowest level since March 2021. This measure is closely watched by the Federal Reserve and could shape future interest rate policy. Indeed, markets responded swiftly and positively, with the Dow Jones, S&P 500, and Nasdaq all posting gains on Thursday, reflecting investor optimism that interest rate cuts may be on the horizon.
However, the report was not without caveats. Energy prices surged 4.2% year-over-year, with electricity up 6.9% and natural gas spiking 9.1%, placing continued pressure on household budgets. Food inflation, another closely watched category, rose 2.6%.
Still, the broader downward trend caught experts off guard. Harvard economist Ken Rogoff admitted to CNN that he was “surprised” by the numbers. “It was a better number than anyone was expecting,” he said, emphasizing that “there’s no other way to spin it—it was positive news.”
The report arrives amid an aggressive effort by the Trump administration to reframe the economic narrative. In a prime-time Oval Office address on Wednesday night, President Trump touted the data as proof of his policies’ success and announced a “warrior dividend” of $1,776 to active-duty U.S. service members—a symbolic nod to American history and a bold stroke in economic populism.
Trump also linked the improving economic outlook to stricter immigration enforcement, arguing that his administration’s crackdown on illegal immigration was essential to improving job opportunities and wage growth for American workers. “The flood of illegal immigrants under Joe Biden damaged our economy and stole resources from our citizens,” Trump said.
With midterms approaching and the GOP eyeing key Senate and House pickups, Trump’s “America First Economy” tour is picking up steam. After a stop in Pennsylvania last week, he heads to North Carolina on Friday, a pivotal battleground state where he’ll bring his economic message directly to voters.