Fed signals faster rate hikes as core inflation pressures persist

Federal Reserve officials signaled a potential acceleration in interest rate hikes after October inflation data showed persistent underlying price pressures, with markets pricing in a higher chance of a half-point increase in December. Core inflation rose 0.3% for a third straight month, exceeding economist forecasts of 0.2%, while Fed Governor Christopher Waller said a 50-basis-point hike should be considered if core CPI hit that level. Dallas Fed President Lorie Logan also suggested faster action may be possible. The data showed unexpected increases in auto insurance, public transit, and medical services costs, which could hit middle and lower-income households hardest. Fed Vice Chair Michelle Bowman expressed inflation concerns but warned that tighter financial conditions pose risks to the economy.