The price of gasoline is dropping like a rock. Chicken wings are suddenly a bargain. And retailers drowning in excess inventory are looking to make a deal.

After more than a year of high inflation, many consumers are finally starting to catch a break. Even apartment rents and car prices, two items that hammered millions of household budgets this year, are no longer spiraling out of control.

Global supply chains are finally operating normally, as more consumers spend more on in-person services like restaurant meals and less on goods like furniture and computers that come from an ocean away. The cost of sending a standard 40-foot container from China to the U.S. West Coast is $1,935 — down more than 90 percent from its September 2021 peak of $20,586, according to the online freight marketplace Freightos.

The moderation in inflation is just beginning to appear in government statistics. In October, the Federal Reserve’s preferred price gauge, the personal consumption expenditures index, posted its smallest monthly increase since September of last year, and is up 6 percent over the past 12 months. The better-known consumer price index is rising at an annual rate of 7.7 percent, down from 9.1 percent in June.

The Fed has been raising interest rates sharply since March in a bid to get inflation back to its 2-percent price stability target. Fed Chair Jerome H. Powell on Wednesday noted signs of progress, but said it was far too early to claim victory. Friday’s stronger-than-expected jobs report, which showed wages rising too quickly for policymakers’ tastes, only underscored the point. The central bank does not expect to reach its inflation goal until 2025.

Still, there are clear signs of improvement in merchandise prices, as consumers resume their pre-pandemic spending patterns. Excluding volatile food and energy prices, goods prices rose in October by 5.1 percent, down from a 12.3 percent annual rate in February.

But as goods prices begin cooling, pressure is building on services. Rising demand and limited supply — think short-staffed restaurants — has services inflation running at an annual 6.7 percent rate, more than twice the year-ago figure.

“The expectation is that goods prices will continue to disinflate. But services inflation will more gradually slow and will be much stickier,” said Kathy Bostjancic, chief economist at Nationwide.

Washington Post, David J. Lynch

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