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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
US DATA
- There is plenty of focus on a BLS e-mail sent Tuesday to so-called “super users” concerning January’s jump in OER inflation (from 0.42 to 0.56% M/M despite primary rents easing from 0.39 to 0.36% M/M). The BLS has since tried to retract it.
- Bloomberg reports that the e-mail simply read: “The weights for single family detached homes increased materially from December 2023 to January 2024. All of you searching for the source of the divergence have found it. No additional information related to this question will be disseminated. We do not do diagnostic analysis of microdata.”
- Further from Bloomberg: “At issue is the relative weighting of single-family detached homes versus multifamily units in OER, the largest individual component of the CPI. It rose in January by the most since April 2023, marking a sharp reversal from a trend of moderation in recent months. The BLS is “currently looking into this data, and we may have additional communication regarding the rent and OER data soon,” an economist at the agency told Bloomberg in an emailed statement.”
- As we wrote in the MNI Inflation Insight published after CPI, analysts offered explanations for the surprise OER strength: “NWM make two good points here: there appears to have been a generous seasonal factor for OER in January, and regional differences including that the OER strength was driven in the South which has more owners than renters. Other analysts note the change in sampling in 2023 which shifted the OER sample back toward more heavily reflecting single family units in a backdrop of still strong house price increases and limited single family home supply”
- You can see the discrepancy between OER and primary rents on pg 2, followed by analyst views, here: https://roar-assets-auto.rbl.ms/files/59963/USInflationInsightFeb2024.pdf
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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