When the Federal Reserve lowered its benchmark interest rate by half a percentage point in September, it wasn't a particularly surprising move. At that point, the Fed was expected to make its first rate cut of the year in response to cooling inflation.

October inflation readings out this week have shown little progress toward the Fed's two percent inflation target, putting into question how deeply the Federal Reserve will cut interest rates in 2025.

Forget the "Fed put." These days, it's starting to seem like the Federal Reserve has been working on a new derivative: the Fed call. That's according to Doug Ramsey, chief investment officer and portfolio manager at the Leuthold Group.

Inflation increased to 2.6% in October, rising modestly from the previous month, according to the Consumer Price Index (CPI) released by the Bureau of Labor Statistics (BLS).

The Federal Reserve cut interest rates by 0.25% on November 7. More interest rate cuts are likely through the end of 2026.

The Fed is expected to cut rates for a second straight month but by a smaller amount. How and when consumers may feel the effects isn't as clear.

The Fed cut rates for the second time this year. Learn how this impacts mortgage rates and what to expect in the coming months.

Forecasters had expected lingering inflation in October. How will the new numbers affect the next Federal Reserve decision on interest rates?

The Labor Department on Wednesday reported that consumer prices in October rose 2.6% from a year earlier. That marks a pickup in the pace of inflation from September, when prices were up 2.4% on the year.