Many of us have become accustomed to higher inflation and years of rising prices, but costs have now fallen for the first time in 4 years in the United States.
The latest Consumer Price Index shows a small but significant decline.
Prices fell by 0.1% from May to June, marking the first monthly decline since May 2020.
Year-over-year inflation slowed to 3% in June, down from 3.3% in May.
The change is partly driven by falling gasoline prices and both new and used cars, while housing, food, and medical service costs continue to rise.
The better-than-expected inflation report further fueled hopes that an interest rate cut could happen sooner and help make borrowing cheaper. Interest rates are currently at their highest in the last 23 years, as a result of the U.S. central bank’s (Fed) anti-inflation campaign.
Which prices have fallen?
The price of used cars, notoriously high during the pandemic, has slowed by more than 10% compared to June 2023 and fell by 1.5% from May.
Airfare prices dropped by 5.1% compared to last year and 5% month-over-month.
Cell phones fell by more than 10% year-over-year. Televisions: nearly 6%. Smart home devices decreased by more than 4%, as did health insurance costs.
What continues to rise?
The price of car insurance has risen by 19.5% since last June, a problem felt nationwide. The monthly index increased by 0.9%, reversing the 0.3% decline from May.
The cost of rent and housing in general, energy, medical and hospital services, and food continues to rise.
Source: Yahoo Finance