Inflation: little to trust

The latest Consumer Price Index (CPI) report for November has raised concerns over data accuracy due to the US government shutdown. Fed Chair Jay Powell warned that the figures may be distorted after a pause in data collection. Meanwhile, tensions in Venezuela have put the Trump administration’s energy strategy under scrutiny, as global oil markets remain unaffected by potential supply disruptions.

November’s CPI report showed a 2.7 per cent annual rise, lower than September’s 3 per cent and below the expected 3.1 per cent. The figures for rent and owner’s equivalent rent appeared unusually low, with month-on-month increases of just 0.06 per cent and 0.13 per cent. Analysts suspect these numbers were calculated assuming no change in October, casting doubt on their reliability.

Core goods prices rose only 1.4 per cent year over year, offering a small positive sign. However, this category also suffered from the data-collection gap caused by the shutdown. Excluding shelter, core services inflation remained stubbornly above 4 per cent, indicating persistent price pressures in certain sectors. In a separate development, the Trump administration’s actions near Venezuela have puzzled financial markets. With oil prices already low, the strategic push against the Maduro regime seems aimed at securing cheap energy, boosting US business deals, and reinforcing supply chains. A potential escalation in Venezuela could test Washington’s resolve, though experts believe even a major export restriction would have little effect on global energy prices due to current market surpluses.

The November CPI report’s questionable accuracy highlights the impact of disrupted data collection. Meanwhile, the Trump administration’s focus on Venezuela reflects broader energy and geopolitical goals. Despite potential supply risks, the global oil surplus is expected to keep prices stable for now.