US inflation came in hot:
U.S. inflation remained elevated last month, underscoring the need for the Federal Reserve to raise interest rates again this year.
Overall prices rose 0.4 percent in October after a 0.6 percent jump in September, according to the latest Consumer Price Index report from the Bureau of Labor Statistics. “Core” prices, which strip out volatile food and energy items, rose 0.3 percent.
The agency on Tuesday did not release year-over-year figures for October because it was unable to collect data during last year’s government shutdown. According to calculations by The New York Times, overall prices were around 4 percent higher compared with the same time last year, up from 3.7 percent in September. Over the same period, core prices rose about 2.8 percent.
One of the biggest drivers of inflation in October was food. Prices rose 0.5 percent last month and about 3 percent since the same time last year. That likely reflects a surge in energy prices, especially diesel prices, which have exploded costs for farmers.
Energy prices overall rose modestly in October and were up 0.7 percent for the month after a 5.2 percent jump in September. Gasoline prices rose 1 percent, significantly slower than the 9.1 percent increase during the previous period. Electricity prices rose nearly 1 percent.
October’s C.P.I. report was the last before the Fed meets for its final gathering of the year on Dec. 8-9. Policymakers have signaled that they will raise rates next month as they seek to stamp out price pressures that have pushed inflation further from their goal. While the Fed tracks C.P.I., it officially targets 2 percent inflation, as measured by the Personal Consumption Expenditures index. That level has been overshot for nearly six years.
Fed officials also watch the price of services as an indicator of the underlying pace of inflation. Specifically, they have been looking at core services excluding housing, a measure sometimes referred to as “supercore.” Those prices rose 0.4 percent in October, and have risen at an annual rate of nearly 5.5 percent over the past three months.
On Tuesday, Christopher J. Waller, a Fed governor, raised the prospects of a larger-than-usual half-point interest rate increase at the bank’s meeting in December if inflation did not show signs of moderating.
In remarks delivered at a Bank of England event, Mr. Waller said a quarter-point increase would suffice if price pressures improved. But if “core” inflation rose 0.3 percent or more, as October’s data showed, Mr. Waller warned that the Fed risked its credibility by not moving more aggressively. “Hiking only 25 basis points would put our credibility at risk, a risk I am not eager to take,” he said.
Two-year Treasury yields, which are sensitive to changes in interest rate expectations, were up over 0.1 percentage points on Tuesday to 4.67 percent as investors raised wagers that the Fed would raise rates more over time to quell inflation. The labor market remains in solid shape, as October’s report released on Friday showed, affirming that the Fed can focus solely on its inflation problem.
October marked the seventh straight month in which price increases outpaced wage growth on a 12-month basis. Average hourly earnings were up 3.1 percent in October from a year earlier, well below the roughly 4 percent annual inflation pace.
Here in the frozen north, five-year Canadas rocketted up from 3.38% at noon to 3.46% at the close.
The New York Fed published its Household Debt and Credit Report (Q3-2026):
Total Household Debt Expands Moderately; Aggregate Delinquency Rates Tick Up
Total household debt expanded by $334 billion, a 1.8 percent increase, to reach $19.1 trillion in the third quarter, according to the latest Quarterly Report on Household Debt and Credit. Aggregate delinquency rates worsened, with 5.0 percent of outstanding debt in some stage of delinquency, up 0.3 percentage points from the previous quarter. Transition into early delinquency continued to tick up for auto loans and mortgages but improved slightly for credit cards. Transition rates into serious delinquency slightly improved for credit cards and student loans, while those for auto loans and HELOCs remained flat. Mortgage balances rose by $257 billion in the third quarter and totaled $13.4 trillion at the end of September.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
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| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.8191 % | 2,737.7 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.8191 % | 5,155.6 |
| Floater | 5.66 % | 5.75 % | 46,425 | 14.25 | 1 | -0.8191 % | 2,971.2 |
| OpRet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.1932 % | 3,618.1 |
| SplitShare | 4.90 % | 5.36 % | 50,326 | 3.24 | 6 | 0.1932 % | 4,320.8 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.1932 % | 3,371.2 |
| Perpetual-Premium | 5.80 % | 5.85 % | 43,978 | 14.07 | 1 | -1.3807 % | 3,025.9 |
| Perpetual-Discount | 5.73 % | 5.82 % | 44,010 | 14.14 | 33 | -0.0695 % | 3,290.5 |
| FixedReset Disc | 5.71 % | 6.14 % | 87,141 | 13.47 | 22 | 0.0965 % | 3,352.8 |
| Insurance Straight | 5.65 % | 5.75 % | 54,219 | 14.21 | 20 | -0.3327 % | 3,186.7 |
| FloatingReset | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0965 % | 4,093.8 |
| FixedReset Prem | 6.00 % | 5.36 % | 69,825 | 2.26 | 28 | 0.0393 % | 2,610.5 |
| FixedReset Bank Non | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0965 % | 3,427.3 |
| FixedReset Ins Non | 5.64 % | 5.63 % | 46,066 | 14.14 | 13 | 0.5000 % | 3,231.5 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| ENB.PF.C | FixedReset Disc | -3.56 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 22.40 Evaluated at bid price : 23.00 Bid-YTW : 6.51 % |
| CU.PR.F | Perpetual-Discount | -2.25 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 19.99 Evaluated at bid price : 19.99 Bid-YTW : 5.65 % |
| GWO.PR.I | Insurance Straight | -1.48 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 19.94 Evaluated at bid price : 19.94 Bid-YTW : 5.73 % |
| GWO.PR.S | Insurance Straight | -1.45 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 22.19 Evaluated at bid price : 22.47 Bid-YTW : 5.92 % |
| SLF.PR.D | Insurance Straight | -1.40 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 20.36 Evaluated at bid price : 20.36 Bid-YTW : 5.54 % |
| POW.PR.C | Perpetual-Premium | -1.38 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 24.68 Evaluated at bid price : 25.00 Bid-YTW : 5.85 % |
| SLF.PR.C | Insurance Straight | -1.26 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 20.35 Evaluated at bid price : 20.35 Bid-YTW : 5.55 % |
| PWF.PR.Z | Perpetual-Discount | -1.16 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 21.86 Evaluated at bid price : 22.10 Bid-YTW : 5.86 % |
| CU.PR.E | Perpetual-Discount | -1.15 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 22.16 Evaluated at bid price : 22.44 Bid-YTW : 5.46 % |
| PWF.PR.L | Perpetual-Discount | -1.04 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 21.61 Evaluated at bid price : 21.86 Bid-YTW : 5.87 % |
| GWO.PR.P | Insurance Straight | 1.15 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 23.45 Evaluated at bid price : 23.74 Bid-YTW : 5.76 % |
| CU.PR.D | Perpetual-Discount | 2.68 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 22.32 Evaluated at bid price : 22.59 Bid-YTW : 5.42 % |
| MFC.PR.F | FixedReset Ins Non | 5.87 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 21.28 Evaluated at bid price : 21.28 Bid-YTW : 5.66 % |
| BN.PF.G | FixedReset Disc | 6.99 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2030-07-01 Maturity Price : 25.00 Evaluated at bid price : 24.80 Bid-YTW : 6.15 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| BN.PF.N | FixedReset Disc | 52,900 | YTW SCENARIO Maturity Type : Call Maturity Date : 2032-01-01 Maturity Price : 25.00 Evaluated at bid price : 25.04 Bid-YTW : 5.47 % |
| SLF.PR.G | FixedReset Ins Non | 50,800 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 20.96 Evaluated at bid price : 20.96 Bid-YTW : 5.63 % |
| ENB.PR.D | FixedReset Disc | 35,610 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 22.80 Evaluated at bid price : 23.27 Bid-YTW : 6.24 % |
| BN.PF.I | FixedReset Prem | 25,500 | YTW SCENARIO Maturity Type : Call Maturity Date : 2027-03-31 Maturity Price : 25.00 Evaluated at bid price : 25.20 Bid-YTW : 4.92 % |
| BN.PF.B | FixedReset Prem | 22,905 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 23.44 Evaluated at bid price : 24.85 Bid-YTW : 6.09 % |
| SLF.PR.D | Insurance Straight | 19,000 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-11-10 Maturity Price : 20.36 Evaluated at bid price : 20.36 Bid-YTW : 5.54 % |
| There were 3 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| See TMX DataLinx: ‘Last’ != ‘Close’ and the posts linked therein for an idea of why these quotes are so horrible. | ||
| Issue | Index | Quote Data and Yield Notes |
| ENB.PF.E | FixedReset Disc | Quote: 23.89 – 24.90 Spot Rate : 1.0100 Average : 0.6481 YTW SCENARIO |
| ENB.PF.C | FixedReset Disc | Quote: 23.00 – 23.91 Spot Rate : 0.9100 Average : 0.5574 YTW SCENARIO |
| BIP.PR.F | FixedReset Prem | Quote: 25.26 – 25.86 Spot Rate : 0.6000 Average : 0.3749 YTW SCENARIO |
| ENB.PR.P | FixedReset Disc | Quote: 24.26 – 24.93 Spot Rate : 0.6700 Average : 0.4837 YTW SCENARIO |
| CU.PR.F | Perpetual-Discount | Quote: 19.99 – 20.99 Spot Rate : 1.0000 Average : 0.8289 YTW SCENARIO |
| CU.PR.K | Perpetual-Discount | Quote: 24.25 – 25.31 Spot Rate : 1.0600 Average : 0.8893 YTW SCENARIO |