Good explanation. I recently read an article that noted that more people are renting single family homes now (presumably because of the still-rather-high price of buying). How might that affect this new measure?
A January 2023 New York Fed study of “inflation persistence” found “the housing sector clearly stands apart.” After wisely cautioning that a “backward-looking. . . twelve-month measure gives too much weight to data a year old,” the authors find a common inflation trend for both goods and non-housing services (contrary to Chair Powell) with both declining. “The common trend has declined since early 2022,” they demonstrate graphically, but the “sector-specific trend. . . almost entirely driven by housing has continued to increase.”
The data lag of OER -with its 24.5% weight- is a huge distortion which the Harmonized Index of Consumer Prices easily fixes (or CPI less shelter, or PPI).
Good explanation. I recently read an article that noted that more people are renting single family homes now (presumably because of the still-rather-high price of buying). How might that affect this new measure?
A January 2023 New York Fed study of “inflation persistence” found “the housing sector clearly stands apart.” After wisely cautioning that a “backward-looking. . . twelve-month measure gives too much weight to data a year old,” the authors find a common inflation trend for both goods and non-housing services (contrary to Chair Powell) with both declining. “The common trend has declined since early 2022,” they demonstrate graphically, but the “sector-specific trend. . . almost entirely driven by housing has continued to increase.”
The data lag of OER -with its 24.5% weight- is a huge distortion which the Harmonized Index of Consumer Prices easily fixes (or CPI less shelter, or PPI).
what do you use to create your charts? they look great