Hi Bob !
The deceleration was caused by sharp declines in the prices of used cars and trucks (down 1.5% in August compared to July on a seasonally-adjusted basis), hotels and motels (down 3.3%), airfares (down 9.1%), motor vehicle insurance (down 2.8%), car and truck rental (down 8.5%), and “admission to movies, theaters, and concerts” (down 0.6%).
These price declines likely reflect a combination of
Easing strains on the motor vehicle supply chain due to the satiation of consumer and rental fleet demand
The impact of the delta variant on consumer demand for certain services
The possibility that some hotels, airlines, and car rental agencies increased prices too much over the summer in the expectation of a snapback of price-insensitive business travel, and are now reversing course
Even adding in other pandemic-sensitive categories that didn’t experience falling prices—personal care services, admissions to sporting events, club memberships, childcare/tuition, and, most notably, energy, restaurants, and new vehicles—the net inflationary impact of these idiosyncratic categories was essentially zero in August.
America's Inflation Story Is Entering a New PhaseIdiosyncratic price spikes due to reopening and troubles in the motor vehicle supply chain are fading or reversing. But keep an eye on housing, health care, and restaurants.
https://theovershoot.co/p/americas-inflation-story-is-entering?token=eyJ1c2VyX2lkIjo0MTg2MzEyNiwicG9zdF9pZCI6NDEzMjE1MTYsIl8iOiJPUFFCZiIsImlhdCI6MTYzMTcwMzc5MiwiZXhwIjoxNjMxNzA3MzkyLCJpc3MiOiJwdWItMzg0NjQwIiwic3ViIjoicG9zdC1yZWFjdGlvbiJ9.ypdbC1Yk3tdPh8yfj-9VhEiWBmkTrMoFsBgu3gQeOwM
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