US inflation rises 0.4% in October as Fed weighs hike

US consumer prices rose 0.4 percent in October from September, a smaller monthly increase than the previous report but still enough to keep attention on a possible Federal Reserve interest rate hike in December.

The Labor Department data showed the consumer price index slowing from a 0.6 percent monthly rise in September. Energy price increases moderated, with the gasoline index up 1 percent after a 9.1 percent jump in the previous monthly report.

Food prices rose 0.5 percent in October after being unchanged in September. Medical care, household furnishings and several other categories also rose. Inflation excluding volatile food and energy components increased 0.3 percent.

Oxford Economics said the report "sets the stage for a December Fed hike" and said food inflation drove the miss in the headline figure. Joseph Brusuelas, chief economist at RSM, said the data could keep a larger increase under consideration at the December Fed meeting.

Federal Reserve Governor Christopher Waller had signalled support earlier Tuesday for a December rate increase, saying the central bank must act "sooner rather than later" to return inflation toward two percent over the medium term. He said he was leaning toward a 25-basis-point increase but that a 50-basis-point move should be considered if October pricing dynamics looked like the previous month.