Restless Americans fueling white-hot demand for travel caught a break last month thanks to lower prices for airline tickets and rental cars.

In May, airfares in the U.S. fell 13% from a year earlier, the largest decline since March 2021, according to figures released by the U.S. Bureau of Labor Statistics on Tuesday. Prices for rental cars and trucks sank 12%, the most since May 2020 when the pandemic drastically curtailed travel.

Airlines had slashed prices to court leery travelers during the pandemic-era flying trough. The easing of Covid restrictions last year led to a rebound in travel – and prices – but flight costs are now comparable to what consumers paid a decade ago, according to United Airlines Chief Executive Officer Scott Kirby.

“We’re just coming back to normalcy in pricing. The pandemic years were the aberration,” Kirby said Monday in an interview. “I think this is the new normal for travel.”

Airfare declines came amid a broader slowdown in the pace of inflation, with the consumer price index decelerating to 4% in May, the slowest rate of price hikes in more than two years.

Despite seeing some relief in the cost of getting places, travelers had to pay more to stay there. The price of hotels in May rose 3.7% year-over-year, according to BLS data.

Source: (c) 2023, Bloomberg · Ryan Beene