McCullough & Jonesy: CPI Will Be Driven Higher By Rents

In this edition of The Macro Show, Hedgeye CEO Keith McCullough and Director of Research Daryl Jones discuss Hedgeye’s outlook for inflation, and how our view on shelter has our CPI forecast far above the rest of the Street.

"A third of that CPI headline number is rent. Where do you think Shelter is going next? It just bottomed; it’s going to mean-revert. The probability of this shooting through its previous cycle-high is very high," explains McCullough as he runs through our differentiated view on headline CPI and inflation.

“Both Steiner and Simone talked about rents on the call; our view there is much different than the Street. We think rents are going to be much higher for longer, underpinning higher CPI prints,” remarks Jones, highlighting the underlying inflationary factors driving CPI.

[thor]

maybe the Fed will omit rent along w/ food and energy and call it transitory

[yogathan]

Tons of inflation in wages since 1980 keep up the good work. Interest rates are only going up!

[gurneetchatha]

Inflation will stay fed will have tough time dealing with it

[arbitrader]

The feds not letting rates go back up past 2% your smoking crack sir.

[chrislemieux]

Lol but it wasnt. 60% were vehicle related

[dmircea]

U called me a chart monkey. Actually it's one of nicest things I been called. Dood u gotta interview star path academy! For real though