Group 1 - The recent unexpected decline in U.S. inflation data has drawn significant market attention, suggesting a positive signal of economic cooling and price stability, but the complexities in the Consumer Price Index (CPI) calculation, particularly the subjective weighting of Owner's Equivalent Rent (OER), may distort the data and impact Federal Reserve policy accuracy [1][2] - OER, a major component in the housing weight of CPI, is based on homeowners' subjective estimates of rental value rather than actual market transactions, leading to potential statistical biases that may inflate housing costs in CPI calculations [2][4] - The setting of OER weights is not static and lags behind market changes, which diminishes CPI's ability to reflect true inflation levels, especially during rapid economic shifts [2][4] Group 2 - The Federal Reserve heavily relies on CPI and other economic data for monetary policy decisions, but these data often exhibit lagging characteristics, which can lead to blind spots in policy-making, particularly in a complex and changing economic environment [3][4] - Historical misjudgments by the Federal Reserve, such as the 2021 assessment of inflation as "transitory," were partly due to over-reliance on lagging data that failed to capture underlying economic issues, resulting in delayed policy adjustments [3][4] - The disconnect between Federal Reserve policy and actual economic trends highlights the risks of relying on outdated data, as seen in the unexpected economic growth in 2023 despite predictions of recession following banking turmoil [3][4]