Bloomberg Talks — Chief Economist at Wolfe Research Stephanie Roth Talks November US CPI Report

Date: December 18, 2025
Host: Paul Sweeney (with Tom Keene)
Guest: Stephanie Roth, Chief Economist, Wolfe Research
Topic: Analysis of the November 2025 US Consumer Price Index (CPI) Report

Episode Overview

This episode centers on Stephanie Roth’s expert analysis of the surprise US November CPI inflation report. Roth discusses data quality issues, the impact of seasonal holiday factors, the state of labor markets, and implications for Fed policy. The conversation also briefly touches on prospective Federal Reserve appointments.

Key Discussion Points & Insights

1. November CPI Report: A Surprising Print and Underlying Data Issues

• Main theme: The latest CPI came in weaker than expected, but Roth cautions against reading too much into it.

  • Roth warns of data distortions in the November print due to “a lot of error in this report.”
  • Holiday discounting is exaggerated in the numbers because the survey period was shifted later into the month when markdowns peak.
  • The Bureau of Labor Statistics (BLS) didn’t adjust seasonal factors, “so that automatically makes the data artificially weak,” notes Roth.
  • Prediction: Expect "a bounce back in December."
  • (00:50–01:16)

  “A key thing that there's an issue with...when they're sampling the data, specifically around November, that the survey period was condensed into later in the month when you typically have significant holiday discounting...the data [is] artificially weak.”
  — Stephanie Roth (00:50)

2. Inflation Trends and Fed Interpretation

• Despite the headline weakness, Roth suggests the real takeaway is that inflation isn’t rising.

  • Usual worries that tariffs would prevent holiday discounting didn’t materialize; 2025 saw normal seasonal markdowns. (01:20–01:41)
  • The idea of a disinflationary trend led by January data is likely overstated.
  • She expects inflation to "bounce back in the next couple of prints," and predicts the Fed will remain on hold “for much of the beginning of next year.” (02:25–02:39)

  “To form a strong conclusion about this print in particular as being some massive disinflationary period, I think is entirely inaccurate.” — Stephanie Roth (02:53)

3. The Labor Market: Resilient with Nuanced Data

• Employment numbers are better than surface impressions suggest:

  • Private payrolls are “actually quite decent” and indicate modest growth—around 70,000 jobs per month.
  • The uptick in unemployment isn’t as alarming, attributed in part to data quirks from the government shutdown and deferred resignation programs rather than true job losses.
  • The “headline jobs numbers are impacted...by not necessarily the government shutdown in particular, but the deferred resignation program which ended at the end of September.”
  • (03:51–04:38)

  “If you look at the private payroll numbers, they were actually quite decent. Now we're looking at a trend that's closer in the 70,000 range, which is really not bad.”
  — Stephanie Roth (04:20)

4. Sources of ‘Noise’ in the Inflation Data

• Airlines and Apparel were major contributors to weak inflation:
  • “Airlines fell 6.5% over two months...the core number was 0.1159 across both months. That’s, you know, quite low. Apparel was pretty weak. That is probably tied to this whole holiday discounting issue.” — Stephanie Roth (04:53–05:18)
  • Many service-sector categories (auto insurance, utility bills, medical bills) in the CPI remained “pretty flat” or “soft.”
  • “It's hard to know to what extent this is government shutdown related. My sense is it probably is and we'll see a bit of a bounce back.”
  • (06:12–06:24)

5. Implications for the Fed and Prospective Appointments

• Fed Policy: Roth expects the Fed not to overreact, reiterating her forecast for no immediate rate changes as more accurate data comes.
• On possible Fed appointments:
  • “I would love to see Waller. I think he'd be a great pick and I think markets would really prefer to see Waller...it’s probably more likely to be Hassett. Although...there seems to be some more concerns about Hassett or at least more hesitation out of the White House for picking him.”
  • (06:41–06:57)

Notable Quotes & Memorable Moments

• On the utility of the CPI print:

  “There is a lot of error in this report. So I would not take much away from this.”
  — Stephanie Roth (00:50)

• On labor market resilience:

  “The unemployment rate rose [but] there was again some issues with the government shutdown impacting the data.”
  — Stephanie Roth (04:36)

• On Fed appointment preferences:

  “I would love to see Waller. I think he'd be a great pick and I think markets would really prefer to see Waller…”
  — Stephanie Roth (06:41)

Timestamps for Important Segments

• 00:50 — Roth explains why the November CPI report is distorted by timing and seasonal factors.
• 01:32 — Discussion of expected holiday discounting and effect of tariffs.
• 02:25 — Debate over inflation trends and the Fed’s likely reaction.
• 03:51 — Analysis of labor market data and private payroll trends.
• 04:53 — Examination of inflation's key drivers: airlines and apparel.
• 06:12 — Service sector categories in the CPI.
• 06:41 — Preferences and predictions for the next Fed chair.

Tone and Style

The discussion maintains a conversational, thoughtful, and analytical tone. Roth is concise and direct about the limitations of the current data, while the hosts probe for both nuance and actionable takeaways—balancing technical detail with practical policy implications.

Summary

Stephanie Roth urges caution in interpreting the November 2025 CPI report, highlighting multiple sources of statistical noise and one-off effects. She sees no evidence for a major disinflationary trend, expects the labor market to remain steady based on private payrolls, and foresees the Fed holding rates steady while waiting for cleaner data. The episode closes with a brief, candid take on potential Fed leadership choices, underscoring the market’s preference for candidates deemed steady and credible.