Get All Access for $5/mo

Airfare Prices Are Dropping as Inflation Cools, According to the June Inflation Report. Will Rent Prices Be Next? The latest numbers were released Wednesday.

By Madeline Garfinkle

Key Takeaways

  • Rent prices have continued to rise, but at a slower pace than they were a few months ago.
  • Some key products and services that declined were airfare, gas, and used vehicles.

Opinions expressed by Entrepreneur contributors are their own.

Inflation remains high, but there could be signs of cooling, according to the just-released June Inflation Report.

Inflation rose at the slowest rate in two years in June, a small win for the economy and the Fed, which has been working to tame inflation for nearly 16 months.

The consumer price index (CPI), which measures the average change in prices experienced by consumers, rose 0.2% in June, after increasing 0.1% in May. While the CPI is up 3% over the last 12 months, June's inflation report marks the smallest monthly increase since August 2021, signaling that inflation is showing signs of finally cooling. Still, it may be too early for the Fed to declare victory.

"This is very promising news," Laura Rosner-Warburton, senior economist and founding partner at MacroPolicy Perspectives, told The New York Times. "The pieces of the puzzle are starting to come together. But it's just one report, and the Fed has been burned by inflation before."

Among the key products and services that declined were airfare, gas, and used vehicles. Meanwhile, rent prices have continued to rise.

How rent prices affect inflation

Rent prices are still rising, but at a slower pace than they were a few months ago — which is good news for tenants, who are finally seeing some relief after months of steep increases. The Labor Department reported that rents rose 0.5% last month, the slowest rate of increase since late last year.

Rent is the largest component of the CPI (accounting for over 70% of the monthly increase), so a slowdown in rent increases would help to bring down overall inflation. However, housing costs are still rising faster than overall consumer prices.

Related: The Inability to Afford a Down Payment Is Why Renters Keep Renting, According to a New Report from the Federal Reserve

How much has airfare dropped?

Airfare prices dropped 8.1% in June, following declines in both April and May. The drop follows a confluence of factors that hiked up prices over the past year, including pent-up demand, a shortage of seats, and rising fuel prices. However, as the demand for flights has eased and supply has increased, airfares have begun to drop.

Overall, the report says there are some signs that inflation is cooling in some areas while prices are still rising in others, and it's unclear how long the slowdown will last.

Related: The Average Cost of a Wedding Went Up — Again. Here's How Much a Celebration Will Cost You in 2023

Madeline Garfinkle

News Writer

Madeline Garfinkle is a News Writer at Entrepreneur.com. She is a graduate from Syracuse University, and received an MFA from Columbia University. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Business News

Meta Makes $1 Million Dollar Donation to Donald Trump's Inaugural Fund

Meta CEO Mark Zuckerberg also reportedly gave Trump a pair of Ray-Ban Meta smart glasses.

Side Hustle

'Hustling Every Day': These Friends Started a Side Hustle With $2,500 Each — It 'Snowballed' to Over $500,000 and Became a Multimillion-Dollar Brand

Paris Emily Nicholson and Saskia Teje Jenkins had a 2020 brainstorm session that led to a lucrative business.

Leadership

Should I Stay or Should I Go? 8 Key Points to Navigate the Founder's Dilemma

Here are eight key signs that help founders determine whether to persevere or let go.

Marketing

Your Most Powerful Marketing Weapon Is Hiding in the Finance Department — Here's Why

Transform your marketing leadership by turning finance from a barrier into a strategic ally. Learn how aligning with your finance team can drive unprecedented growth and innovation.

Starting a Business

They Bought an Ice Cream Truck Off eBay for $5,000. Now Their Company Has 70 Shops and Sells Treats in Over 12,000 Stores.

For the episode of "The Founder CEO," the co-founder and CEO of Van Leeuwen Ice Cream explains how one ice cream truck grew into a successful nationwide brand.