As inflation continues to slow, some items like furniture and used cars are leading the pack with price drops.
On an annual basis, prices of products and services are rising at a rate of two.9%, government data released Wednesday shows. Although still higher than the perfect rate of two%, the newest consumer price index (CPI) was higher than many economists expected, and it marks the primary time in greater than three years that inflation has dipped below 3%.
The CPI measures how prices within the economy are changing for every thing we buy, from homes and cars to books and toys. Some categories within the index fluctuate up and down on a regular basis, like food and energy items.
Beyond the same old price volatility, July’s report showed a bunch of things which can be getting cheaper regardless that they do not go down in price often. That features big-ticket items that usually require financing like used cars and residential appliances, which have seen lower demand amid high rates of interest.
Consumers are also reportedly getting more selective about their spending, which could possibly be taking pressure off prices for discretionary spending categories. Several major corporations including McDonald’s, Starbucks and (most recently) Home Depot, have told their investors they’re seeing more “weakness from the patron.”
In consequence, after years of stubbornly high inflation and rates of interest, prices at the moment are falling for several items. Listed below are six things getting cheaper as inflation cools:
Used cars
Bank of America said in a Wednesday report that the used cars category of the CPI is considered one of the “principal drivers” of falling goods prices. Used automobile prices have sunk prior to now 12 months amid high auto loan rates, and the CPI showed a 2.3% drop on this sector from June to July.
In keeping with a separate report out Wednesday from Edmunds, average used automobile prices were $27,472 within the second quarter of 2024, down from $29,742 a 12 months earlier.
Apparel
The Bureau of Labor Statistics highlighted falling clothes prices in a news release. Overall, prices were down 0.4% for the month. Apparel categories like men’s suits (-4.2%) and girls’s outerwear (-1.1%) had larger monthly price drops.
Airline fares
Because the summer travel season involves a detailed, it’s getting just a little easier to search out reasonable airfare, as prices fell 1.6% month-over-month. The decrease is not driven by seasonal trends, either. “On a yearly basis, airline fares, after rising steeply in 2022, have fallen for 16 months in a row and are below their pre-pandemic price level,” the White House Council of Economic Advisers said in a tweet Wednesday.
Furniture
Furniture prices fell 1% from June to July and are down a whopping 5.9% over a 12 months. Consumers sometimes use financing to afford major furniture purchases, and this price drop could possibly be an example of the Federal Reserve’s high rates of interest taking a toll on an industry.
Some food items
Food prices remain persistently high, as Americans are reminded of each time they go to the shop. Prices for grocery items surged especially in 2022, and a few staples, like eggs and beef, are still rising much faster than the whole rate of inflation. Overall, though, food prices appear to be moderating, because the CPI indicates that they’ve only gone up 1.1% prior to now 12 months.
More excellent news? Prices for several food items actually dropped in July, including apples (-1.2%), fresh seafood (-2.4%) and ice cream (-2.1%).
Televisions
When you’re out there for a recent big screen, you may find a way to search out a deal: TV prices are down 1.1% from June and 5.4% from a 12 months ago.
More from Money:
Best Credit Cards of August 2024
White House Takes Aim at ‘Corporate Tricks’ That Waste People’s Time and Money
How you can Claim As much as $2,500 in Recent Money App Settlement