Consumer prices are rising at their fastest clip in decades, but a handful of products have gotten less expensive.
Americans are getting walloped by higher inflation. A by economists at the University of Pennsylvania’s Wharton Business School found that the average household must spend $3,500 more in order to buy the same amount of goods and services they did in 2000. But despite inflation hitting a in January, a handful of items have actually gotten cheaper over the last year. Prices dropped for more than a dozen goods and services from January 2021 to January 2022, according to government data released on Thursday. That includes books, smartphones and other items, such as: To be sure, such purchases don’t offset the sharply higher prices that Americans are paying for groceries, gasoline, rent and other staples. But they offer insight into the quirks of an economy in which rising demand from consumers, exacerbated by a strangled supply chain, is pushing up prices for everything from meat to bicycles. «What we’re seeing is that the inflation rates tend to ebb and flow with the state of the virus,» said Adam Shapiro, an economist at the Federal Reserve Bank of San Francisco. «When the pandemic first hit, we saw a very sharp decrease in inflation» as people stayed home and cut back on spending. That’s no longer the case. And with continuing supply-chain issues causing shortages of computer chips, auto parts and other products, inflation is unlikely to go away any time soon, according to economists. «There is a strong risk that these supply constraints and bottlenecks could persist and that will push up inflation,» Shapiro said. So why are some items declining in price while everything else is rising? There may be two reasons, economists and industry experts said.
