Price changes in some industries point toward a possible slow in inflation.
Key Details
- Some consumer prices have started to fall in the last several months, hinting at a potential slowdown in rising inflation.
- Though prices on products like gasoline, airfare, and used cars have decreased somewhat, grocery prices, household goods, and healthcare items have continued to rise, according to The Wall Street Journal.
- Some analysts suggest that the Labor Department’s overall consumer-price index will have remained the same or dropped from August to July. If this is the case, it could be positive news as it would be the second straight month of slowed inflation.
Why it’s news
A break in inflation could be good news for everyone. Lowered inflation before midterm elections could be positive for incumbent elected officials, potentially lower expenses for consumers, and may cause the Federal Reserve to reevaluate inflation rates.
Prices are higher in just about every industry due to inflation, supply chain issues, and changing demand. Consumers are responding by adjusting their spending habits, resulting in retailers lowering prices to get excess inventory to move.
Gas prices fell in part due to the consumer habits changing. Customers traveled less, stayed in for meals, and combined errands to cut down on mileage.
Even with some prices falling, grocery prices continue to rise, presenting an immediate problem for the majority of consumers. More shoppers are buying grocery items to cook from scratch, often a cheaper option than pre-made meals, The Wall Street Journal reports.
Surprising statistics
From July to August, prices on some goods and services decreased…
- The price of gasoline dropped by 9%. At the beginning of July, a gallon of unleaded gas was $4.22, but by the end of August it had dropped to $3.84.
- Domestic flight prices fell 11% from July to August according to travel website Hopper.
- Hotel rates decreased 4.6%.
- Used car prices have declined 1.2%.
Even with some prices dropping, food prices are increasing. Grocery prices are up 13.4% from a year ago and rose 1.6% from the month before in August.
