US inflation increased slightly from 2.6% to 2.7% in November, while core inflation remained stable at 3.3%. Despite this, analysts believe that the Federal Reserve will likely proceed with a 25 basis point interest rate cut in the coming week.

The key interest rate continues to exceed the inflation rate, which gives the Fed the ability to act comfortably. The latest data shows that rents are the main driver of persistent inflation, with no new inflationary pressures emerging. Used car prices have seen a significant increase, rising by 2% in November following a 2.7% jump in October. On the other hand, airline ticket prices have stabilized, increasing by only 0.4% month-over-month after a larger increase since August.

Looking ahead, there is optimism that core inflation may further decline into 2025 due to base effects. However, potential punitive tariffs from the Trump administration could introduce new inflationary pressures, although the details of such tariffs are uncertain. The current high real key interest rate allows the Fed to implement rate cuts as necessary.