With the latest indicators showing consumer price inflation continues moderating from its June 2022 peak, prices for some goods have actually fallen over the past few years, according to underlying commodity data from the Bureau of Labor Statistics.

Consumers are seeing the biggest improvements in energy prices, as shown in Figure A below. Families filling up their oil tank for the winter ahead will be paying 36% less for heating fuel compared with prices in mid-2022. Gasoline is down 29% and heating and cooking gas is down 15%.

Families shopping for a new washer and dryer will see prices 10% lower than two years ago. At the market, they’ll be paying 8% less for apples, 3% less for milk and bacon, and 1% less for tomatoes. Prices for boys’ and girls’ shoes are 2% lower than two years ago.

Overall consumer price index growth remains above the Federal Reserve’s 2% target for inflation, though continues trending down, with the pace of inflation falling by nearly six percentage points since June 2022. But prices for a number of household staples like chicken, bananas, eggs, and car tires are rising slower than the Fed’s inflation target, too.

This is all good news for workers who have seen wages growing 1.2 percentage points faster than prices for the past two years (Figure B). Hopefully the outlook for wages and prices will continue to improve in the months ahead.