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Inflation has eased, but Americans are still on the lookout to save

MILES PARKS, HOST:

Inflation is cooling off a bit, but prices do continue to climb, and many Americans are looking for ways to cut corners. According to the Commerce Department, personal spending rose just one-tenth of 1% in May. NPR's Scott Horsley reports on how price-conscious folks are coping.

SCOTT HORSLEY, BYLINE: Ruth Adamsky has always been frugal, she says. So when the Bristol, N.H., resident reads advice columns about how to save money, most of the tips are things she's already doing. Adamsky, who relies on Social Security, keeps a tight lid on her grocery bill. She typically cooks meals from scratch rather than buying pricey prepared foods.

RUTH ADAMSKY: The day before yesterday, I made six dozen pot stickers and put them in the freezer for whenever.

HORSLEY: Adamsky has also cut back on buying books and magazines, and she's skipping this year's comic con convention even though she already has a homemade costume inspired by a favorite Star Wars character.

ADAMSKY: I belong to a Facebook group for Kylo Ren costumes. And you haven't lived until you've seen a bunch of guys saying, how do you put a zipper in a sleeve?

HORSLEY: Stocks zipped up yesterday on hopes that inflation might be cooling off. The Dow Jones Industrial Average jumped 285 points. But underneath the costume, the picture is not so rosy. So-called core inflation, which strips out volatile food and energy prices, remained stubbornly high in May. That's the figure that's closely watched by the Federal Reserve. Electricity prices have jumped nearly 6% in the last year. As the summer heats up, Rebecca Veverka is looking for cheaper ways to stay cool.

REBECCA VEVERKA: I've been shopping around trying to find cheaper electricity and just been keeping the windows open as much as I can, hanging out in the basement if I can, just to - every little penny counts with the energy prices being as hugely inflated as they have been.

HORSLEY: Veverka, who lives in Parma, Ohio, has also started shopping at a discount grocery store, going without her favorite sparkling water, and juggling streaming services to cut her cost for televised entertainment.

VEVERKA: Rather than having Netflix and Disney+ and Peacock and five others that are must-haves, I've canceled all of them. I'm only using one at a time. So right now, I have Peacock. So I finished "Poker Face." It's probably time to move on to - I guess I'll watch "Ted Lasso." That one's on Apple+ (ph).

HORSLEY: The Commerce Department says many people are making more money. Personal income rose faster than spending in May, so many people were able to save more. Veverka used some of her savings to pay down credit card debt, which has grown increasingly costly with rising interest rates. The average interest on credit cards now tops 20%, a record high. While pinching her pennies, Veverka opted not to visit a friend in Washington state this year. She is planning a trip to Myrtle Beach, though, later this summer to see her parents.

VEVERKA: I've been putting it off, but I managed to find a pretty decent airfare later in August through the, you know, economy Spirit Airlines, which - it gets me there, I guess.

HORSLEY: Airfares have fallen in each of the last two months, thanks in part to lower jet fuel prices. Overall, Americans spent less money on stuff in May, but more money on services like travel and entertainment. Adamsky, the retiree in New Hampshire, keeps a positive attitude about coping with inflation on a fixed income. It's all about setting priorities, she says. If there's something she really wants, she'll find a way to cut spending elsewhere.

ADAMSKY: You make choices with what you have available to you. I don't feel like I'm suffering. I mean, why should I? I have six dozen Chinese pot stickers in the freezer. I'm rich.

HORSLEY: That kind of attitude may come in handy during what's turning out to be a lengthy battle to put inflation itself on ice. Scott Horsley, NPR News. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.