Fed Governor Waller Warns Inflation Could Challenge Year-End Stock Rally

The October Consumer Price Index rose 0.4% month-over-month on Nov. 10, exceeding economist expectations by 0.1%, raising concerns about inflation and potentially challenging the stock market's year-end rally prospects. Core CPI, excluding gas and energy, also rose 0.3%, beating forecasts by 0.1%. Fed Governor Christopher Waller stated he favors considering a 50 basis point rate hike in December if inflation remains elevated, warning a quarter-point increase could risk the Fed's credibility. Following the data, market probabilities for a half-point December hike jumped to nearly 15% from zero, though a quarter-point hike remains the consensus. Investors await the October PCE index and November jobs report before the FOMC's Dec. 9 meeting.