Bloomberg’s Joshua Zumbrun smells what’s cooking

For all the attention given to almost $4-a-gallon gas, the biggest threat to containing U.S. inflation may be the shift away from homeownership, which is pushing up the cost of leases across the nation’s 38 million rented residences.

Shelter represents about 40 percent of the consumer price index excluding food and energy and accounted for almost one quarter of the 1.3 percentage point rise in April. That share has grown as falling home prices shake Americans’ confidence in housing as an investment.

The last sentence doesn’t quite make sense. Perhaps, the author doesn’t realize that Owner Equivalent Rent is also in the BLS inflation measure. That’s not meant disparagingly. Lots of folks get tripped up on this stuff.

In any case the point is that rents are rising, and rents are hefty portion of inflation.