London Daily

Focus on the big picture.
Tuesday, Jun 16, 2026

Inflation has stopped Americans from buying vehicles of all kinds — but they're still splurging on travel and good times

Inflation has stopped Americans from buying vehicles of all kinds — but they're still splurging on travel and good times

Despite US inflation at a 41-year high, people are still spending on travel-related expenses like flights and hotels.

Even though inflation is at a four-decade high, Americans are still spending big on travel and experiences.

The Consumer Price Index rose 9.1% over the year ending in June per data published this week, higher than the 8.6% over the year ending in May. The 9.1% rate — the highest since November 1981 — is affecting people's spending behavior.

Although some people are modifying how they spend their money like looking for cheaper alternatives amid high inflation, people are handing over lots of money on certain goods and services. Spending on travel and transportation has shot up this year, but on the other hand, people aren't spending as much on vehicles, consumer spending data shows.

The following chart shows the percent change from January 2022 to May 2022 in Personal Consumption Expenditures from the Bureau of Economic Analysis. The items and services in the chart are some of the things that have seen the largest percent increases in consumer spending during this period.


People are splurging on vacations and good times away from home despite higher prices, as travelers once again take part in "revenge travel." Expenditures on foreign travel were 68.4% higher in May than at the beginning of the year. Spending on air transportation is also almost 40% higher than in January. Additionally, people are spending more on accommodations as they buy hotel and motel rooms for their travel needs.

Monthly Personal Consumption Expenditures data is only available up until May. But with travel demand up as people vacationed for fourth of July and throughout the summer, it may be the case that travel continues to be a popular thing people dish out money on, even with the high costs consumers are facing.

Consumer spending for gas was also up in May from January, with a percent increase of 27.7% for gas and other motor fuel, mirroring skyrocketing gas prices over the last few months. However, Energy Information Administration and AAA data show gas prices have been coming down from their peak.

There are also goods and services that have seen personal spending decline from where they once were earlier in the year. As seen in the following chart, that includes various kinds of vehicles like motorcycles and new autos or light trucks.

People may not be willing to spend big on cars right now with monthly payments soaring. Data from Cox Automotive research shows the monthly payment for a car has reached a record high.


The above chart also highlights that spending is down from earlier this year for different kinds of repairs.

In general, people were spending more on services than goods in May — with spending on services rising $76.2 billion but falling $43.5 billion on goods from April according to the Bureau of Economic Analysis.

Newsletter

Related Articles

0:00
0:00
Close
UK Supreme Court Revises Legal Definition of Deprivation of Liberty
King’s Birthday Honours Recognise Contributions Across Science, Culture and Public Service
UK Ministry of Defence Reports Interdiction of Russian Shadow Fleet Vessel
UK and US Launch Joint Regulatory Programme for Medicines and Healthcare Products
Solicitor General Refers Murder Sentence to Court of Appeal Under Unduly Lenient Scheme
UK Launches £1.6 Million Mobile Museum Initiative to Expand Cultural Access
Judicial Pay Structure Undergoes Government Review Following Senior Recommendations
Government Confirms Nearly 180 New Youth Hubs Across the United Kingdom
UK Government Expands Careers Support Through Partnership with LinkedIn
Digital News Report Highlights Growing Global Concern Over AI and Information Overload
UK Chancellor Reaffirms Fiscal Discipline and Borrowing Reduction Strategy
UK Government Invests £219 Million in Sustainable Aviation Fuel Development
Rolls-Royce Small Modular Reactors Secures Major Swedish Export Contract
Government Confirms Locations for Nearly 180 Youth Hubs Across Great Britain
UK Government Partners with LinkedIn to Expand Employment Support Services
Reuters Institute Report Flags Rising Public Anxiety Over News and Information Overload
UK Government Commits £219 Million to Expand Sustainable Aviation Fuel Industry
Chancellor Convenes Market Engagement Group to Assess UK Economic Outlook and Productivity Risks
Rolls-Royce Wins Multibillion-Pound Swedish Contract for Small Modular Nuclear Reactors
Government to Ban Social Media Access for Under-Sixteens Across the United Kingdom
Government Approves Fast-Tracked Broadcast Merger Reshaping UK's Media Landscape
Resignation of Defence Secretary John Healey Triggers Debate Over UK Military Strategy
Britain Intensifies Diplomatic Efforts to Support US-Iran Ceasefire
Bank of England Faces Tough Interest Rate Choices After Economic Contraction
Belfast Sees Second Day of Anti-Migrant Riots as Police Deploy Water Cannons
UK Economy Shrinks in April as Energy Price Shocks Weigh on Growth
UK to Ban Social Media Access for Children Under 16 From 2027
UK Parliament Opens Week of Fast-Tracked Security and Infrastructure Legislation
Northern Ireland Projects £21 Million Boost From Major Cultural and Sporting Events
UK and Japan Sign Technology Security Pact to Strengthen AI and Supply Chain Cooperation
UK Welcomes US-Iran Peace Breakthrough Aimed at Restoring Strait of Hormuz Shipping
British Forces Intercept Russian Shadow Fleet Oil Tanker in English Channel Sanctions Operation
UK to Ban Social Media for Under-16s Under Landmark Online Safety Expansion
Anti-Immigrant Riots Spread Across Belfast, Raising Security Concerns
Ministry of Defence Opens Europe's Largest Drone Testing Facility in Swindon
Kemi Badenoch Calls for Deregulation to Restore City's Global Competitiveness
UK Housing Market Posts Sharpest June Price Decline in Fourteen Years
NHS Waiting Lists Rise to 7.22 Million as Diagnostic Delays Reach New Highs
Makerfield By-Election Raises Prospect of Labour Leadership Challenge
Bank of England Expected to Hold Interest Rates at 3.75% Despite Growing Policy Divisions
Royal Marines Seize Sanctioned Russian Oil Tanker in English Channel
Prime Minister Keir Starmer Set to Ban Social Media and AI Chatbots for Under-16s
United Kingdom Markets Rally After US-Iran Deal Reopens Strait of Hormuz
Defence Secretary John Healey Resigns Over Military Spending Dispute, Triggering Cabinet Crisis
Royal Navy Takes Part in Trooping the Colour for the First Time in 350 Years
Think Tank Warns Labour's European Union Reset Could Carry Significant Economic Costs
UK Semiconductor Centre and Japan's Rapidus Forge Advanced Chip Manufacturing Partnership
UK and Japan Launch Offshore Wind Compact Backed by £9 Billion in Investment
Starmer and Trump Discuss Iran Peace Efforts and Reopening of the Strait of Hormuz
United Kingdom and Japan Sign £18 Billion Investment Partnership Focused on Clean Energy and Advanced Technology
×