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Rising interest rates, inflation force consumers to pull back in online shopping

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Consumers reined in their online shopping in April due to “rising interest rates and persistent inflation,” according to a new report. 

Consumers collectively spent $77.8 billion online in April, down from the over $83 billion spent online in March, according to e-commerce data from the Adobe Digital Price Index (DPI). 

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Online spending nationwide grew to double-digits in January when consumers doled out $71 billion, a 12.2% increase compared with the same time last year. In February, consumers spent $67 billion, a 15.5% year-over-year increase. 

April spending, by comparison, grew 4.5% compared with a year ago. 

Woman online shopping (iStock / iStock)

Patrick Brown, vice president of growth marketing and insights at Adobe, said in a statement that spending in April was driven by “durable demand for e-commerce.”

However, “as the cost of borrowing and economic uncertainty rises for consumers, we are beginning to see the early impact on both online inflation and spend,” Brown added. 

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April marks the 23rd consecutive month of year-over-year inflation, according to Adobe. However, it also showed “early signs of online price increases beginning to slow,” according to the report. 

Online prices increased 2.9% year over year in April, down from the 3.6% year-over-year increase in March. 

Additionally, 10 out of the 18 product categories tracked by Adobe saw prices fall from March to April. For instance, prices for electronics dropped 0.9% from March while the prices for apparel dropped 1.7%. 

Certain categories like groceries and pet products saw prices continue to rise.

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