Investors aren’t sure whether the unprecedented fiscal and monetary stimulus will lead to sustained inflation or to a “stagflation” in which price pressures cut directly into economic activity.

That uncertainty explains the whipsaw in US stock markets during the past several sessions. No one knows when consumers will balk at higher prices and save their money rather than spend it, or when businesses will reduce operations because higher input costs crush their profit margins.

What we do know with a fair degree of certainty, though, is that Americans who rent their homes are in for a nasty shock.

Rents fell during the pandemic because demand collapsed, in part because a federal moratorium on evictions kept renters in their existing homes. But the price of new rentals, as reported by the website,  came roaring back this year, with a nearly 10% rise in the average new rental between December 2020 and June 2021.

The cost of shelter comprises nearly 40% of the US Consumer Price Index, the gauge that determines payouts on Treasury Inflation-Protected Securities.

The eviction moratorium is scheduled to expire at the end of July. That means that the rent component of CPI will converge on the current market prices reported by market sources like

Worsening the outlook is a nationwide housing shortage. The apartment vacancy rate in the US is close to its all-time low of 6%. Home prices, meanwhile have risen nearly 14% year-on-year according to the Case-Shiller Index, and the median selling price has risen 23% according to the National Association of Realtors.

All this means that CPI inflation above 5% is baked into the cake for the next 18 months.