What: Adobe reports price drops for 14 out of 18 tracked categories, year-over-year and month-over-month.

Why it is important: While food prices continue to rise both online and in stores, online prices are dropping in major categories like electronics and apparel. The deflation of online prices is a welcomed relief for consumers who are pulling back on spending in response to the impending recession.

Consumers spent 73.7 billion USD online in July, down from 74.1 billion USD in June. On a year-over-year basis, however, e-commerce spending in July grew 20.9%. Online spending in July also decreased compared to May (78.8 billion USD) and April (77.8 billion USD).

Of Adobe’s observed categories, groceries, tools/home improvement, pet products, and non-prescription drugs experienced inflation last month. On a year-over-year basis, only seven of the 18 categories saw price drops: electronics, jewellery, books, toys, computers, sporting goods and apparel.

The price deflation online has been tied to retailers’ oversupply coupled with the need to address wavering consumer confidence and a pullback in spending.

Online prices drop