Supply shock for sure if you add the COVID pandemic coupled with
the Ukrainian war, however the fantastic money supply growth
is the bigger culprit . Inflation is a monetary phenomenon.
Monetary stimulus plus expansive fiscal policy pushed
aggregate demand to very high levels while aggregate
supplies were curtailed. That pushed prices up beyond
anything experienced.
Now you need to curtail demand through higher interest
rates. Housing that is mostly financed through loans will
likely get hit first, and that has a large negative multiplier
effect.
the Ukrainian war, however the fantastic money supply growth
is the bigger culprit . Inflation is a monetary phenomenon.
Monetary stimulus plus expansive fiscal policy pushed
aggregate demand to very high levels while aggregate
supplies were curtailed. That pushed prices up beyond
anything experienced.
Now you need to curtail demand through higher interest
rates. Housing that is mostly financed through loans will
likely get hit first, and that has a large negative multiplier
effect.