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June 13, 2023 : According to the latest Adobe Digital Price Index report released today, online prices experienced a significant year-over-year decline of 2.3% in May, marking the largest drop since the beginning of the pandemic. This report adds to the mounting evidence that overall inflation is subsiding. In April, consumer price index inflation fell below 5% for the first time since June 2021, and this downward trend is anticipated to continue with the release of the May CPI figures.
The report highlights a shift from high-value items as prices for essential goods like groceries continue to rise. The appliance category experienced its most substantial price decrease since Adobe started monitoring digital prices in 2014, with a year-over-year drop of 7.9%. This finding aligns with recent findings from the Commerce Department’s retail sales figures.
As revealed by Adobe’s data, this may mark the ninth consecutive month of year-over-year price decreases for online purchases. On a month-over-month basis, online prices dropped by 1.2% in May compared to April, surpassing the decline in April, when prices were down 0.7% from the previous month.
Out of the 18 categories tracked in the Digital Price Index, 11 experienced price decreases in May. However, grocery prices continued to climb, albeit slower than in previous months. The rate of increase in grocery prices has been gradually decelerating over the past eight months since reaching a record high in September 2022. In May, grocery prices rose 8.2% year-over-year and 0.3% compared to April, significantly lower than the 9.3% year-over-year increase in April.
Despite the elevated prices, there remains strong demand for online grocery delivery, contributing to persistent inflation in this category. As reported by Adobe, consumers are increasingly shifting their grocery spending toward online purchases.
The May report also highlighted notable trends in other categories. Personal care products experienced a year-over-year increase of 2.7% and a 0.3% decrease compared to April. This category has seen persistent inflation since September 2020. Appliance prices showed the most substantial decline, down 7.9% year-over-year, while home and garden prices dropped 6.3% year-over-year and 0.9% monthly.
Among the categories with year-over-year price increases in May were groceries, personal care products, pet products, non-prescription drugs, medical equipment and supplies, tools and home improvement, and apparel. On the other hand, prices decreased in categories such as flowers and related gifts, electronics, books, toys, computers, furniture/bedding, jewelry, sporting goods, and office supplies.
The Adobe Digital Price Index is a digital complement to the Consumer Price Index, which monitors offline prices. The Digital Price Index provides valuable insights into the online pricing landscape by leveraging data from over one trillion visits to retail sites and tracking over 100 million products across 18 categories.
