Updated Dec 19, 2022 - Economy

Where to find holiday deflation

Price change in select consumer goods
Data: Bureau of Labor Statistics; Chart: Axios Visuals

This time last year, soaring demand for goods in short supply fueled inflationary pressure for holiday-related items — that is, if you could find them. This holiday season, however, is shaping up a little differently.

Why it matters: The supply-demand mismatch from pandemic disruptions has begun to heal, helping drive the long-awaited goods deflation. That means a more affordable season for many gift givers.

  • That said, the price shifts are uneven across goods, while some other areas of holiday spending — including food and air travel — remain far more expensive than a year ago.

By the numbers: Costs for a range of goods are on the downswing, thanks in part to retailers marking down prices to clear out inventory (after miscalculating exactly how long the extreme consumer demand would stick around).

  • Prices for sports equipment (if you are gifting a new baseball bat, soccer ball or hiking gear) are getting cheaper: down 0.9% in November. They are still 5.3% higher than a year ago, according to the Consumer Price Index.
  • Toy prices fell 1.4% last month, and are a mere 0.6% higher than a year ago.
  • The cost of women's coats and jackets fell over 1.3% last month, and are down 2% over the last year.
  • If you're looking to gift a bottle of whiskey, the price is up only 1.7% over the last year.

Visiting family, too, will be less pricey than in recent months. Airline fares have fallen more than 1% on average in the past three months. Compared to a year ago, they are still up a whopping 36%.

  • Drivers will pay slightly less at the pump than this time last year: then, gas prices averaged roughly $3.30, according to AAA. Now it's about 20 cents cheaper.

Yes, but: One crucial area where Americans won't be saving is at the dinner table. Cooking a holiday feast will cost more, with "food at home prices" rising quickly. The details of your preferred protein matter, however.

  • Poultry is up 13.1% over the last year, and ham prices have risen 8% in that span. However, beef roast costs have fallen 8.1% over the last year.
  • Desserts — cakes, cookies or cupcakes — are up nearly 18% (over 1% in November).

The bottom line: Inflation is still hurting plenty of Americans' budgets, and cutting into wage gains.

  • But the recent slowdown is appearing in a way that might make some aspects of the holiday season — toy-buying or traveling to see loved ones — more palatable.
Go deeper