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MNI INTERVIEW:US CPI Rent Costs To Gain Momentum-Fed Economist

(MNI) WASHINGTON

Cleveland Fed economist says rent inflation for new tenants leads official BLS rent inflation by roughly 4 quarters.

The boost to CPI inflation from housing is likely to accelerate further before reversing course even though the rental market from which such measures are computed has started to soften, Cleveland Fed economist Randal Verbrugge told MNI.

"I expect CPI rent to have a bit of momentum because it's just much more slow moving. I sort of expect CPI rent to grow a little bit more and then start to slowly decelerate," he said in an interview. "New tenant rents are probably going to decelerate back to kind of a normal level and slowly average rents will fall back to that."

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The boost to CPI inflation from housing is likely to accelerate further before reversing course even though the rental market from which such measures are computed has started to soften, Cleveland Fed economist Randal Verbrugge told MNI.

"I expect CPI rent to have a bit of momentum because it's just much more slow moving. I sort of expect CPI rent to grow a little bit more and then start to slowly decelerate," he said in an interview. "New tenant rents are probably going to decelerate back to kind of a normal level and slowly average rents will fall back to that."

Keep reading...Show less