In April, inflation finally slowed online, but overall remained “punitively high.”

Short dive:

  • April saw the first signs of a slowdown in online inflation, according to Adobe’s digital price index, which said online prices fell 0.5% month-on-month but still rose 2.9% from the past. years.
  • Prices have fallen by more than half of the 18 product categories tracked by Adobe monthly. «As borrowing costs and economic uncertainty grow for consumers, we are beginning to see an early impact on both online inflation and spending, ”said in a press release Patrick Brown, Adobe’s vice president of marketing growth and understanding..
  • The Federal Consumer Price Index showed prices rose 0.3% monthly on the economy in April, less than 1.2% in March. Year-on-year prices rose 8.3% in April.

Diving Insight:

Any relief from inflation is good for consumers. As for retailers and brands, even the largest are oriented cost inflation throughout the enterprise – in fuel, products, materials and cargo, among other areas.

Margins and profits for many have remained or increased in recent months, even as costs have increased as companies raise prices for their customers. However, some of the last quarterly issues have brought disappointing figuresand executives cite concerns about consumer inflation among other problems macroenvironment.

Neil Saunders, managing director of GlobalData, called the growth of the April CPI compared to the same period last year.punishing high ”and“ threatening both consumer spending and consumer confidence ”.

Saunders also noted in e-mail comments that in April 2021, prices began to turn upward, meaning that the annual comparison masks the full magnitude of inflation. In two years, prices rose by 12.8% in April, Saunders said.

Overall, consumer demand remains quite strong. This was discovered by Earnest Research consumer spending rose 3% on an annualized basis in April, that research firm noted a re-acceleration since March. Breaking these figures, costs in stores increased by 7%, and costs on the Internet decreased by 3% (which may explain the decline in prices).

The increase in costs did not affect everyone. According to Earnest Research, spending has largely declined year on year, with the exception of retailers, except for resale clothing, and mass retailers such as large retailers and warehouse clubs, as well as pet stores and supermarkets.

Inflation also changes the way and when consumers spend. In March clothing inflation reached a record 42 years of 6.8% due to rising costs of textiles, transport and wages, according to Coresight Research. The research firm found that consumers expect to buy fewer goods, seek more discounts and defer non-product costs to cope with higher prices.

Saunders noted that many households “have the firepower of high savings and continue to benefit from reduced spending on services such as travel and leisure, as pandemic trends have not yet fully eased. ”

But Saunders also noted that inflation affects and frightens middle- and low-income people.

“In our data, we see some early signals,” Saunders said. “Consumer credit and debt are expanding. Volumes of purchased goods, especially in certain categories such as clothing, are falling. Reduced levels of impulsive shopping, especially online.

https://www.retaildive.com/news/inflation-finally-slowed-online-in-april-but-remained-punishingly-high-ov/623729/ In April, inflation finally slowed online, but overall remained “punitively high.”

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