It also happens that during the 2012-2020 period when the OER-light PCE deflator was posting at just 1.3% per annum, the OER itself rose by 3.0% per annum. That is to say, nearly one-third of the 70 basis per annum “shortfall” from the 2.00% target is alone due to the absurdly under-weighted cost of home-ownership in the PCE deflator. And when you throw in an allowance for true, rampant medical care inflation rather than the phony administered Medicare/Medicaid prices contained in the PCE index, there really isn’t much inflation gap left.
PCE Deflator Versus 16% Trimmed Mean CPI, 2012-2020
In a sense, this all puts you in mind of the juvenile sociopath who killed his parents and then threw himself upon the mercy of the court on the grounds he was a orphan.