US November CPI meets expectations, Fed rate cuts likely ahead.

Key receivers

U.S. consumer prices rose 2.7 percent in November, keeping inflation above the Federal Reserve's 2 percent target. Traders are expecting a quarter-point cut in the federal funds rate at the upcoming Federal Reserve meeting.

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Fresh November CPI data showed consumer prices rose as expected on Wednesday, keeping the Federal Reserve on track for rate cuts next week, especially when the November jobs report released earlier this month showed strong job growth.

The consumer price index rose 0.2% on a monthly basis, matching both October's increase and economic estimates, data from the Bureau of Labor Statistics showed on Wednesday.

Core CPI, which includes variable food and energy prices, rose 0.3% from October and met analysts' estimates of a 3.3% annual rate.

The inflation report comes as markets widely expect the Fed to cut interest rates at its December 17-18 meeting. Traders are pricing in an 86% chance of a quarter-point cut in the federal funds rate, according to CME Group's FedWatch tool.

The November jobs report, which showed a strong 227,000 job gain, further strengthened the case for easing monetary policy. The figure was better than expected and marked a strong improvement from last month's underperformance.

The figure not only beat the Dow Jones consensus estimate of 214,000, but also brought the three-month average payrolls growth to 173,000, reflecting improvements in job gains in October and September.

While inflation has cooled sharply to around 9% in June 2022, the latest data shows that inflation is stabilizing at a level above the Fed's target.

Bitcoin traded above $98,000 before the inflation data was released, recovering from a recent drop below $94,000. The crypto asset has gained 2% in the past seven days, according to data from CoinGecko.

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