Looking inside of the data, housing, which accounts for over a quarter of the index, rose at 5.1% year on year while the main drivers of price increases remained gasoline (+49.6% year on year), transportation (+21.1% YoY), new vehicles (+11.8% YoY) and used cars and trucks (+37.3% YoY).
Food and apparel prices have risen at close to 6% YoY. Below average price increases came from medical care, education and recreation whose prices rose between 1.5% and 3.3% during the past year.
Looking ahead, used car and truck prices may be close to a peak – they typically rise during periods of economic downturn and fall during expansions. However, housing costs remain a significant upside risk.
While rents have risen only around 4-5% during the past year, the cost of buying a home has risen by around 20%. Sometimes in the past purchase prices for homes has lead rent costs by as much as one year. As such, housing costs will be critical to seeing whether or not overall inflation abates in 2022 after 2021’s 7% pace which was the highest in 40 years.”
Read More: US inflation hits 7% for first time since 1982 – business live | Business