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CPI and Equivalent Rents
Old 06-14-2006, 09:05 AM   #1
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CPI and Equivalent Rents

Tony Crescenzi over on saying that without the equivalent rents, the core CPI would only be up 0.1%.

But hasn't the core CPI been "held down" by low equivalent rents for years due to so many people buying houses and having to rent houses for much lower than normal prices?

Ironic now that the economy is slowing down, the housing market is finally showing signs of cooling off, etc., that the core CPI shows inflation that seems to be more an artifact of how housing costs are calculated.

There is a lot of catching up to do in rents. So this might mean high core CPI numbers for a while.

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