Special Report

14 Household Items With Falling Prices Amid Record Inflation

People who thought inflation would start to taper off were astonished by the June consumer price index. It showed that prices rose 9.1% from the same month in 2021. This was the largest jump since November 1981, and it sent the clear message that the damage done to the U.S. economy by inflation is not over. Still, not all household items soared in price. In fact the price of smartphones is plunging.

Inflation began to surge around the start of the year, after a long period when the CPI was up around 2% annually most months. This time of low inflation allowed Americans to enjoy unusually high discretionary income, which in turn helped increase economic growth. 

Supply chain problems, due in part to the COVID-19 pandemic began to plague businesses. This, in turn, caused a scarcity of goods and services needed to create consumer goods. The Russian invasion of Ukraine exacerbated supply chain issues. The invasion triggered sanctions on Russia, which is among the world’s largest producers of crude oil. The ensuing drop in supply was substantial. Fuel is among the items most affected by inflation. Gas prices have risen by 50% or more compared to a year ago.

The solution to the inflation problem has been hotly debated by economists. One solution to bring prices down, at least in theory, is for the Federal Reserve to raise rates and restrain consumption. The Fed has started an aggressive program to raise rates, but it may be too little, too late. Critics believe these rate increases should have started last year.

Among the most pessimistic experts who have formulated a suggested path out of rising inflation is Larry Summers, former treasury secretary and former president of Harvard. He is also considered among the most gifted economists of his generation. He recently told an audience at the London School of Economics: “We need five years of unemployment above 5% to contain inflation — in other words, we need two years of 7.5% unemployment or five years of 6% unemployment or one year of 10% unemployment.” Unemployment has not been over 7% since some of the worst days of The Great Recession. (Here are states where the unemployment rate is at an all time low.)

A large portion of economists and the general public believe a recession will start soon, if it has not already begun. 

While prices of fuel have risen over 50% and the price of some food items Americans use regularly are up over 20%, several items have fallen in price. To determine the household items that are falling in price, 24/7 Wall St. reviewed the BLS’ Consumer Price Index Summary June report. Prices are compared to June 2021.

Among 14 items people buy regularly and that have fallen in price are computers and televisions. 

The price of an item owned by most Americans dropped the most last month, according to the CPI. The cost of smartphones dropped by 20%. 

According to Pew, about 85% of Americans owned a smartphone last year. People regularly upgrade these as new models are launched, particularly by market leader Apple. One reason for the drop in smartphone prices is the fierce competition among Verizon, AT&T, and T-Mobile to gain new customers, most of which they take from one another. (Here are 48 hottest phones of all time.)

Click here to see 14 household items with falling prices amid record inflation.

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