How Changing Shelter Costs Influence Inflation

Fast-rising U.S. shelter costs — consisting of tenants’ rent and owners’ equivalent rent — were the top driver of inflation in 2022, but this may be a trend that has already shifted. Shelter costs account for nearly one-third of the value of the consumer price index (CPI), making them the largest component by far. New rents and home prices both softened in the second half of 2022, but because of the way shelter costs are measured, it could take nearly a year for those changes to be reflected in the CPI.

Source: Bureau of Labor Statistics, 2023 (data through Dec. 2022); The Wall Street Journal, December 6, 2022

Jim Nielsen, CRPS®
Financial Advisor
CUSO Financial Services, LP
at First Heritage FCU
202 Denison Pkwy E • Corning, NY 14830

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2006-2023. All rights reserved.

Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. The Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.

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