RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:No buyers ,no sellers.. Capharnaum wrote: Even without any "measures", inflation numbers should start falling down dramatically around April 2022 (so the May report). Due to the weak comparables and energy prices which are unlikely to fall off, year over year inflation numbers will likely stay high until at least Feb 2022.
This statement here is a bit of a stretch. If inflation reduced dramatically without any measures by April then there would be no need for 3 planned interest rate hikes in 2022.
Given the fact that we are dealing with a new pandemic again I fully expect more supply chain issues once again. One important piece of the equation which most people neglect is the price of real estate and that rent increases typically lag by at least a year.
We have 2 external forces at play here. Goods and services that are directly tied to the pandemic may see some relief once we get through this pandemic and enter the endemic phase. Then we have more sustained forces which would be the Owners Equivalent Rent which will increase in the coming years to catch up to real estate prices. This is the largest component of the CPI index and cannot be ignored. Raising interest rates will keep this segment of the CPI in check and cool off an over heated housing market.
"Homes are also more expensive. The median listing price last month reached $380,000, 9% higher than in October 2020 and 22% higher than in October 2019."
https://www.google.ca/amp/s/www.barrons.com/amp/articles/inflation-rising-prices-remain-elevated-51639500810
https://www.google.ca/amp/s/amp.usatoday.com/amp/6352546001