Adobe released its latest online inflation data from the Adobe Digital Price Index (DPI) showing that online inflation fell 1.6% year-over-year (YoY) in July 2023.
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This marks the eleventh consecutive month of YoY price reductions, with 11 out of 18 tracked categories by Adobe experiencing decreasing prices on an annual basis. On a month-over-month (MoM) basis, online prices showed a decrease of 0.9% in July.
The decline in YoY prices during July was primarily driven by significant drops in categories like appliances, which saw an 8% YoY decrease (down 0.3% MoM), as well as furniture/bedding, experiencing a 3.5% YoY decline (down 0.7% MoM).
Even steeper year-over-year declines were observed in electronics, which dropped by 11.7% YoY (down 0.7% MoM), and computers, which witnessed a 15.4% YoY decrease (down 1.5% MoM).
Despite persistent inflation in the grocery category, YoY price increases have shown a deceleration for 10 consecutive months.
Grocery prices saw a 6.3% YoY increase (up 0.3% MoM), a smaller rise compared to the 7.6% YoY increase in June 2023 and the 8.2% YoY increase in May 2023.
Similar slowing trends have been noted for pet products, with prices registering a 6.3% YoY increase (down 0.1% MoM), in contrast to an 8.1% YoY increase in June 2023 and a substantial 10.2% YoY increase in May 2023.
Key Highlights From the Adobe Digital Price Index for July
Adobe’s Digital Price Index offers an extensive perspective on online consumer spending, complementing the Bureau of Labor Statistics’ Consumer Price Index (CPI), which focuses on offline prices.
The Digital Price Index (DPI) is powered by Adobe Analytics and systematically analyzes over one trillion visits to retail websites in the U.S. Its analysis encompasses more than 100 million Standard Kit Units (SKUs) across 18 product categories, including; electronics, apparel, appliances, books, toys, computers, groceries, furniture/bedding, tools/home improvement, home/garden, pet products, jewelry, medical equipment/supplies, sporting goods, personal care products, flowers/related gifts, non-prescription drugs, and office supplies.
As previously mentioned, in July, 11 out of the 18 DPI categories witnessed YoY price declines, with flowers/related gifts experiencing the most significant drop at 31.6% YoY.
Seven categories recorded YoY price increases, including personal care, pet products, grocery, non-prescription drugs, tools/home improvement, medical equipment/supplies, and apparel.
On an MoM basis, 16 of the 18 DPI categories saw price decreases. MoM Price increases were evident in only two categories, groceries and non-prescription drugs.
Noteworthy Categories for July 2023
Groceries: Prices rose by 6.3% YoY (up 0.3% MoM), with a trend of slowing increases over the past 10 months, compared to a 7.6% YoY increase in June, an 8.2% YoY increase in May, and a peak of 14.3% YoY in September the prior year. The rise in online grocery purchases corresponds closely with trends in the Consumer Price Index.
Pet Products: Prices registered a 6.3% YoY increase (down 0.1% MoM), reflecting a smaller increase than the previous month when prices rose by 8.1% YoY. This category has experienced consistent inflation since May 2020, with YoY price increases noted in every subsequent month.
Appliances: Prices decreased by 8% YoY (down 0.3% MoM) after reaching a record low in June 2023 with an 8.3% YoY decrease. Appliances have seen YoY price declines for 10 consecutive months, following a 29-month stretch of YoY increases starting from May 2020, peaking at 7.1% YoY in December 2020.
Electronics: Prices have continued to decline significantly in recent months, with a YoY decrease of 11.7% (down 0.7% MoM), compared to a 12.9% YoY decrease in June 2023. In contrast, prices were down 9.3% YoY in July 2022. Given its status as a major discretionary category, fluctuations in electronics prices play a significant role in overall online inflation.
For the latest updates on online inflation data, follow the Adobe Digital Price Index here.
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