Inflation: that of goods sold online in the USA plummets. Consumers can no longer spend
Traders anxiously await Wednesday morning's US consumer price index inflation report. American time, then European afternoon. Economists expect June data to come in at the lowest rate in more than two years as the effects of interest rate hikes by the Federal Reserve hamper economic activity . Despite this, inflation has yet to reach the Federal Reserve's 2% target. However, Bloomberg cited new data from Adobe Inc. that shows inflation on goods sold online is plummeting.
Data from Adobe indicates that the prices of goods sold on e-commerce sites fell 2.6% in June compared to the same month last year. This represents the steepest decline since May 2020 and marks the tenth consecutive month of year-on-year declines. Of the 18 product categories Adobe tracked, half saw year-over-year declines, with the most significant decreases in electronics and computers, of 12.9 percent and 16.9 percent, respectively. In addition, the price of household appliances decreased by 8.3%.
Even as laptops and washing machines saw substantial price decreases, there were price increases for online groceries, but they slowed to 7.6% in June, down from 8.2% the previous month and to 10.3% in March.
The slowdown in online shopping is due to a cash-strapped consumer hit by the inflationary storm. Two years of negative real wage growth, forcing many to draw on personal savings as they mounted credit card debt, was a toxic combination. The latest consumer credit report found on Monday that those using credit cards to make ends meet with high borrowing costs are suddenly hitting a brick wall. Wait until student loan repayments resume in September and you will see a much more significant decline in discretionary spending.
Ahead of Wednesday's CPI print, Wall Street forecasts suggest a stock print of 3.1% for June, compared with a four-decade high of 9.1% recorded this past year and the rate of the 4% in May.
There was more good news on Monday as used car prices fell the most since the start of the pandemic.
Inflation has peaked, but several Fed members have called for at least two more rate hikes. “Inflation is our No. 1 problem,” San Francisco Federal Reserve Chair Mary Daly said on Monday.
This is bad news for Amazon Prime Day.
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The article Inflation: that of goods sold online in the USA plummets. Consumers can no longer spend comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/inflazione-precipita-quella-dei-beni-venduti-online-negli-usa-i-consumatori-non-possono-piu-spendere/ on Wed, 12 Jul 2023 07:00:13 +0000.