Flattening Rents to Provide More US Inflation Relief

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Good morning ~!

Today news is U.S. Rent Freeze Push

Treasury Secretary Janet Yellen said she expects a moderation in the rise of housing costs

will help deliver lower inflation in 2024.

Shelter costs carry the biggest weighting in the consumer price index,

accounting for about a third.

They made an outsized contribution to overall inflation in 2023,

and that’s continued this year despite reports that new lease agreements have increased

at a much slower pace or in some cases even declined.

“It takes a while for that to filter into the CPI,” Yellen said Wednesday in an interview with Fox Business.

“And so I have every expectation that the single largest contributor to inflation

is going to be moving down over this year.”

Government data released Tuesday showed a key measure of inflation topped economists’ expectations

for a second straight month in February.

Though many goods continued to show price declines, a jump in gasoline helped drive

the overall consumer price index 3.2% higher than a year ago.

The core measure, which excludes food and energy and is viewed as a better guide

to underlying price trends, rose 3.8%.

More positively, a surprising jump in a closely watched gauge of shelter inflation

in January was not repeated in February,

reassuring economists that rental inflation would eventually recede this year.

Investors also continue to expect price pressures will ease enough in the coming months

to enable the Federal Reserve to begin cutting interest rates by mid-year.

“Inflation is down two-thirds from the high it reached in 2022,” Yellen said.

“I wouldn’t expect this to be a smooth path month-to-month, but the trend is clearly favorable.”

So far, I've learned about the US rent news.

I hope you have a great weekend!

😄😄