Inflation data: How have interest rate expectations changed following this week's events?

On the inflation data front, While warning that a 50 bps increase could be necessary if inflation surprised to the upside, Waller stated he would support a 25 bps tightening move in December even if inflation improved. The central bank already delivered its first tightening move since July 2023 in October, taking the policy rate to 2.5%.

Key points

• For the RBA markets are not pricing any more tightening moves, on the contrary.
• The RBNZ unexpectedly held rates steady at 2.75% in October, in a 4–3 vote.
• Japanese inflation is anticipated to stay above the 2% target, partly reflecting the impact of higher energy prices.
• The BoC also revised its inflation forward view higher, expecting CPI inflation to average roughly 3% in 2027.
• The central bank's latest economic forecasts suggest inflation will stay above 3% until late 2027.

Inside the Inflation data story

The rose US-Iran tensions have added to inflation fears through the energy channel, reinforcing the hawkish pricing. The more robust than expected activity data and persistent domestic inflation pressures have also firmed the case for further tightening. The RBNZ unexpectedly held rates steady at 2.75% in October, in a 4–3 vote, in spite of markets fully pricing a rate increase.

Moreover, Japanese inflation is anticipated to stay above the 2% target, partly reflecting the impact of higher energy prices. The BoC is also projected to deliver another rate increase at the next meeting, in spite of the economic data showing no urgency whatsoever.

The BoC also revised its inflation forward view higher, expecting CPI inflation to average roughly 3% in 2027. For the RBA markets are not pricing any more tightening moves, on the contrary, dealers got under way to price in rate reductions in 2027.

The central bank's latest economic forecasts suggest inflation will stay above 3% until late 2027, but restrictive monetary policy is also forecast to weigh on economic activity.

Why inflation data matters for traders

Inflation figures decide how long central banks keep interest rates high. Hotter-than-expected readings usually lift bond yields and the local currency, while softer data raise hopes of rate cuts.

Price data feed straight into central-bank decisions, which makes them some of the most market-moving releases on the calendar for forex, bonds and stocks.

Market reaction and data

On the currency side, the latest ECB daily reference rates (2026-11-12) show EUR/USD 1.1081, GBP/USD 1.3256, AUD/USD 0.6821, NZD/USD 0.5556, USD/JPY 159.7, USD/CHF 0.8331, USD/CAD 1.4249, USD/CNY 6.6683. These are reference fixes, not live quotes.

What to watch next for inflation data

Next in focus are the coming inflation releases, central-bank reaction to them and changes in market pricing for future rate moves.

Key scheduled releases on the economic calendar:

• USD Core PPI m/m on Fri Nov 13, 13:30 UTC, forecast 0.3%, previous 0.7%
• USD PPI m/m on Fri Nov 13, 13:30 UTC, forecast 0.4%, previous 1.3%

Follow every update in our Top 10 Forex News Today, read Wall Street steadies in spite of Nvidia drama but dip buyers are still walking a tight rope or see all of today's top market news.

FAQ

What is the latest inflation data news?

While warning that a 50 bps increase could be necessary if inflation surprised to the upside, Waller stated he would support a 25 bps tightening move in December even if inflation improved.

Why do inflation numbers move markets?

Inflation data change expectations for central-bank interest rates, and rate expectations drive currencies, bond yields and stock valuations.

Where does this information come from?

This report is based on coverage from investingLive Central Banks, checked against market data where available. It is a summary for information only and not investment advice.