(NEW YORK) — The Consumer Product Safety Commission announced Thursday the recall of more than 407,000 over-the-counter pill bottles, citing the products do not meet the child resistance packaging required by the Poison Prevention Packaging Act (PPPA).
Aurohealth recalled nearly 137,300 units of the Walgreens brand Acetaminophen. Consumers can contact Aurohealth for information on how to return the product to their nearest Walgreens store to receive a full refund.
Aurohealth also recalled about 25,660 units of Kroger brand arthritis pain acetaminophen. Time-Cap Labs recalled nearly 209,430 units of Kroger brand aspirin and ibuprofen. Further, Sun Pharma also recalled about 34,660 units of Kroger brand acetaminophen.
Consumers can contact Kroger for information on how to properly dispose of the product and receive a full refund.
The pill bottles have been sold at supermarkets nationwide.
(NEW YORK) — The Federal Reserve on Wednesday dramatically escalated its fight to dial back historic inflation, raising its benchmark interest rate by 0.75%, the largest rate hike since 1994. The move offers hope that sky-high prices for essentials like fuel and groceries will eventually come down.
The decision will impact the average American and the economy as a whole in profound and largely negative ways, experts told ABC News.
An increase to the benchmark interest rate raises borrowing costs for consumers and businesses, which in theory should slash inflation by slowing the economy and eating away at demand. That means borrowers will likely soon face higher costs for everything from car loans to credit card debt to mortgages, the experts said.
Plus, the rate hike could exacerbate the ongoing stock market decline — a fear validated by early trading on Thursday as all three major stock indexes fell at least 2%. A sustained further decline would hammer portfolios, including 401(k)s that are often pegged to the S&P 500.
On top of that, the strategy all but guarantees an economic slowdown and risks tipping the economy into a recession, the experts added. The hot job market will likely cool, leading to fewer openings for job seekers, slower wage growth and possible layoffs, they said.
“Everybody’s income statement and balance sheet will look a little less attractive here,” said Mark Zandi, the chief economist at Moody’s Analytics. “They need to buckle in.”
What the rate hike means for you
In general, an interest rate hike makes borrowing more expensive. So any purchase that requires a loan — for a home, car, or higher education — could be affected. Credit card rates are also highly sensitive to Federal Reserve moves, so card holders should expect higher payments in the coming months.
Purchasing a home, for example, will likely involve higher mortgage rates. Since mid-March, when the Fed instituted its first rate hike of the year, the average 30-year fixed mortgage has jumped from 4.45% to 6.03%, according to Mortgage News Daily.
That rate could reach as high as 7% or 8%, Derek Horstmeyer, a finance professor at George Mason University’s School of Business, told ABC News. Each single percentage point increase in a mortgage rate can add thousands or tens of thousands in additional cost each year, depending on the price of the house, according to Rocket Mortgage.
“Any sort of asset that you need to borrow money to acquire,” Horstmeyer said. “Will be much more expensive.”
Alongside the heightened cost of loans, investors will face the prospect of a further downturn in the markets for assets like stocks and cryptocurrency. As economic prospects dim and companies face higher borrowing costs themselves, traders may turn elsewhere for safer investments. In addition, the excess income that some put into the stock market during the pandemic will likely be harder to come by.
But economists disagree about how much of the market downturn so far this year has come in anticipation of further hikes from the Fed.
Since many investors already expected rate hikes like the 0.75% increase on Wednesday, the strategy at the Fed may have little effect on the market. But a further market downturn would move stock portfolios, 401(k)s, and likely cryptocurrency holdings even lower, and could delay an eventual market recovery.
The S&P 500 fell deeper into bear market territory in early trading on Thursday, and the tech-heavy Nasdaq Composite is down more than 30% since its last all-time high.
“A lot of the drop is priced in already,” said Horstmeyer, the finance professor, before the stock market fell early on Thursday. “Maybe 5% more to go but knock on wood we don’t go much lower than that.”
What the rate hike means for the economy
By design, the rate hike intends to slow the economy, which should cut demand for goods and labor and in turn reduce inflation.
Despite a contraction of the economy over the first three months of the year, the labor market remains tight and consumer spending has proven resilient. But the rate hike on Wednesday should cool off the labor market and consumer demand, experts said.
As people face higher borrowing costs, their spending will decrease and businesses will see revenue decline. When business performance slows, companies will freeze hiring or even impose layoffs, which will loosen demand for workers and slow wage growth, experts said. In turn, people will have even less money to spend, reinforcing the economic slowdown.
Eventually, the slowdown should ease inflation, providing relief for households struggling to afford gas, groceries, and other necessities.
“At this point, a hard landing is unavoidable,” Eric Sims, a professor of economics at the University of Notre Dame, told ABC News. “There will be some short-term pain.”
But the most recent rate hike — and the additional ones signaled by the Fed on Wednesday — should eventually restore the economy to a healthy rate of inflation, said Jeremy Siegel, a professor emeritus of finance at the University of Pennsylvania’s Wharton School of Business. The central bank’s target inflation rate is 2%, well below the rate of 8.6% recorded in May.
“You need medicine to cure inflation,” Siegel said. “The sooner you give the medicine, the quicker the patient will recover.”
But the strategy of rate hikes risks slowing down the economy so much that it brings about a recession, the experts said. A recession, however, would likely be mild, they said.
And the upcoming months are crucial in determining whether the economy tips into a recession, said Zandi, the chief economist at Moody’s Analytics.
“All the negatives for the economy are at their apex right now,” he said.
“If we can weather this immediate storm of high interest rates, high inflation and slowing growth, I think we’ll make our way through without a recession,” he added.
(NEW YORK) — The pain at the pump is getting worse and has motorists asking, is there any relief in sight?
The average nationwide price of a gallon of gas surpassed an all-time high of $5 last week, according to GasBuddy. In California, the state with the highest average gas price, drivers are paying an eye-popping $6.43 per gallon, AAA data showed.
The price surge owes to the fundamental economic principle of supply and demand, experts told ABC News. Summer travel has sent Americans to the pump at a time when the global market is experiencing a shortage of crude oil supply after the Russian invasion of Ukraine, which pushed millions of barrels of oil off the market.
And the current crisis exacerbates a supply crunch that has endured from a pandemic-induced production slowdown that hasn’t caught up with the renewed surge in demand, the experts said.
The sky-high prices with no relief in sight have set off sharp disagreement among public officials over what should be done in response. Republican members of Congress have faulted President Joe Biden for the price increases, citing what they’ve described as his “war on American energy.” At the same time, Biden has blamed the price surge on the Russian invasion of Ukraine, repeatedly calling it “Putin’s price hike.”
Government policy cannot meaningfully relieve the price increases in the short term, besides an additional release of oil from the strategic reserve or a gas tax holiday, each of which would likely reduce just a fraction of the cost, experts told ABC News. But steps taken now could help foster decreases over the long term and insulate the market from future disruptions, they added.
“There are not the overnight kind of solutions,” said Stewart Glickman, an energy analyst for CFRA Research. “In the longer term, they might make a difference.”
Here are some potential policy solutions to the gas price crisis and whether the experts think they would work.
Releasing more oil from the Strategic Petroleum Reserve
In March, the U.S. announced a commitment to release about 1 million barrels per day from its Strategic Petroleum Reserve, or SPR, over the ensuing six months — a move that aimed to alleviate some of the supply shortage and blunt price increases. The decision came alongside similar announcements from some U.S. allies.
The release of oil from the U.S. SPR is offering slight relief for the rise in the price of gasoline, some experts told ABC News. “The price of oil would be even higher without those stockpiles being used,” said Pavel Molchanov, a senior energy analyst at Raymond James.
If the U.S. decided to release even more oil from its reserves, the move could marginally slow the rise in gas prices even further, the experts said. But the Biden administration should think twice about expanding its release of reserve oil because it could drain the 700 million-barrel stockpile, enough to release 1 million barrels per day for nearly two years, Molchanov said.
“We need to be responsible about it,” Molchanov said. “We cannot use all of those stockpiles in one fell swoop.”
Encouraging domestic oil production
On Wednesday, Biden sent a letter to major oil refinery companies calling on them to take “immediate actions” to increase output. The letter accused the companies of taking advantage of the market environment to reap profits while Americans struggle to afford gas, and it mentioned the possibility of Biden invoking the Defense Production Act, which requires companies to produce goods deemed necessary for national security.
Glickman, the energy analyst at CFRA, said the move from Biden is unlikely to increase supply and lower gas prices, since the domestic industry is already operating at as high as 96% capacity. The refineries cannot add capacity in a short period of time, Glickman added.
Biden is “missing the point a little,” Glickman said. “These are industrial systems that move like battleships, not dinghies.”
U.S. oil refinery capacity stands 1 million barrels per day lower than pre-pandemic levels because several refineries have been closed or converted since early 2020, according to the U.S. Energy Information Administration, or EIA. Refinery inputs for the second and third quarter of this year will average 16.7 million barrels per day, the agency said.
One approach to incentivizing an increase in U.S. production includes a potential tax on oil company profits. But such a move wouldn’t remove the impediments to greater oil production capacity, Glickman said.
“Whether you do something like taxing the industry or not, it isn’t going to change how much capacity you bring back,” he said.
Some Republican members of Congress have criticized Biden for drilling permit restrictions and the shuttering of the Keystone XL Pipeline last year. But oil production in the U.S. last year was nearly identical to that seen over the final year of the Trump administration, in 2020, and greater than the amount produced in 2017 or 2018, according to data from the EIA.
U.S. oil production increased throughout the years of the Trump administration until a sharp, pandemic-induced drop that began in 2020, according to EIA data.
Loosening restrictions on oil drilling would yield long-term gains in oil supply, said James Coleman, an energy policy expert at the conservative-leaning think tank American Enterprise Institute.
“If you were to reform those, it would take a while to have an impact on oil and gas markets,” Coleman said. “On the other hand, if you’re in a hole, maybe the first step is to stop digging.”
Overall, increased U.S. oil production would help reduce gas prices over the next five or 10 years, and protect the industry from future supply shocks, the experts said. However, some experts noted that the sector’s reluctance to aggressively expand production owes to fiscal discipline imposed by shareholders as well as the continued rise of renewable energy. “We know the energy transition is coming at some point,” said Glickman, the CFRA analyst.
Gas tax holiday
A handful of states — led by both Democratic and Republican governors — have suspended their gas taxes as a means of delivering some financial relief for drivers. But the moves only reduce costs by a fraction of the price. In New York State, for instance, Gov. Kathy Hochul this month suspended a roughly 16-cent-per gallon tax. With the average price of a gallon of gas in New York standing at $5, according to AAA, the tax relief amounts to a 3.2% cost reduction.
The federal government could move forward and suspend its gas tax, which amounts to 18.4 cents per gallon. But such a move would also reduce the cost of a $5 gallon of gas by less than 5%. Still, consumers would likely prefer some relief to no relief.
But suspending the gas tax would take away a key policy tool for discouraging the use of gasoline for other purposes, and it would remove a funding source targeted specifically for infrastructure, Adam Hersh, senior economist at the liberal-leaning Economic Policy Institute, told ABC News.
“The gas tax plays a role in disincentivizing the use of gasoline for other energy sources and transportation methods, as well as being tied to funding sources for infrastructure investment,” he said.
(STURGIS, Mich.) — Less than two weeks after restarting production at its Sturgis, Michigan plant, Abbott said it has once again been forced to halt baby formula production after thunderstorms flooded part of the facility.
“These torrential storms produced significant rainfall in a short period of time, overwhelming the city’s stormwater system in Sturgis, Michigan, and resulting in flooding in parts of the city, including areas of our plant,” an Abbott spokesperson told ABC News. “As a result, Abbott has stopped production of its EleCare specialty formula that was underway to assess damage caused by the storm and clean and re-sanitize the plant. We have informed FDA and will conduct comprehensive testing in conjunction with the independent third party to ensure the plant is safe to resume production.”
Abbott’s plant was offline for roughly four months after serious quality control and contamination concerns. Its massive recall and plant shutdown in February exacerbated the nationwide formula crisis American families are still experiencing.
Food and Drug Administration Commissioner Robert Califf said he has personally spoken with Abbott’s CEO, Robert Ford, saying they discussed their “shared desire to get the facility up and running again as quickly as possible.”
Califf added that the storms are a “reminder that natural weather events can also cause unforeseen supply chain disruptions.”
“I want to reassure consumers the all-of-government work to increase supply means we’ll have more than enough product to meet current demand,” Califf said in a series of tweets.
Abbott had promised to start putting out its hypoallergenic formula EleCare to consumers around June 20. Infants with particular nutritional needs will have to wait longer for an infusion of formula from Abbott, the largest domestic manufacturer of infant formula prior to its recall.
“Once the plant is re-sanitized and production resumes, we will again begin EleCare production, followed by specialty and metabolic formulas,” the spokesperson told ABC News. “In parallel, we will work to restart Similac production at the plant as soon as possible.”
Meanwhile, Abbott said it still has “ample existing supply of EleCare and most of its specialty and metabolic formulas to meet needs for these products until new product is available.”
It said these products “are being released to consumers in need in coordination with healthcare professionals.”
“Abbott will have produced 8.7 million pounds of infant formula in June for the U.S., or the equivalent of 168.2 million 6-ounce feedings. This is 95% of what we produced in January, prior to the recall and does not include production from Sturgis,” the company spokesperson said.
(NEW YORK) — Average monthly car payments hit a record high in May while the cost of new vehicles continues to rise, according to industry insiders.
A report from Moody’s Analytics found that typical monthly car payments hit a record high of $712 in May. Kelley Blue Book data found that new vehicle prices averaged $47,148 in May, the second highest on record.
Vehicle affordability worsened again because of higher interest rates and increased car prices, according to a recent Cox Automotive & Moody’s Analytics vehicle affordability index report. The report said “the estimated typical monthly payment increased 1.7% to $712,” which is a new record high for monthly payments.
It would cost 41.3 weeks of median income to buy a new vehicle, which is a jump of 19% from May of 2021, according to the report.
Brian Moody, executive editor for Kelley Blue Book, told ABC News that a low supply of cars and high demand from buyers means consumers “are going to be paying more” than the MSRP. Data from Kelley Blue Book suggests non-luxury car buyers paid on average $1,030 more than the sticker price.
For luxury cars, where experts say there is a lot of demand, buyers are paying an average of $65,379 for a new vehicle, about $1,071 above sticker price, according to Kelley Blue Book data.
But Moody said customers can still get good deals on less sought-after brands like Mazda, Hyundai and Buick.
And prices could even drop later this year, he noted.
“Although prices are up for May, it’s only 1%, and so that indicates … we may be headed toward a place where the prices will start to decrease,” Moody said.
(WASHINGTON) — The Federal Reserve raised interest rates significantly on Wednesday, hiking it 0.75%, escalating a strategy of increased borrowing costs that aims to dial back historic inflation.
The rate hike of 0.75% marks the largest increase since 1994. The dramatic rate increase follows new inflation data that showed a reacceleration of price increases to levels not seen for more than four decades, dashing hopes that inflation had reached its peak.
A rate hike of 0.75% brings the interest rate to a range of 1.5% to 1.75%
The Fed also indicated that more rate hikes will follow in the coming months.
An increase to the benchmark interest rate raises borrowing costs for consumers and businesses, which in theory should slash inflation by slowing the economy and eating away at demand. But the strategy also risks tipping the economy into a recession. The rate hike will likely increase everything from credit card fees to mortgage rates.
The Federal Reserve raised its benchmark interest rate by 0.5% last month, and central bankers had signaled the same increase for June. But a persistent surge in costs appears to have prompted a reevaluation. The consumer price index, or CPI, stood at 8.6% year-over-year in May, a significant increase from 8.3% the month prior, according to data released by the U.S. Bureau of Labor Statistics on Friday.
President Joe Biden has touted the economic recovery from a coronavirus-induced downturn, but acknowledged that many American households are struggling with high costs.
“Jobs are back, but prices are still too high,” he said during a speech in Philadelphia on Tuesday.
Republican members of Congress have criticized Biden for the price hikes, suggesting they stem from his mismanagement of the economy. Biden has attributed high prices to the disruption of food and gas markets that has resulted from the Russian invasion of Ukraine, calling the sky-high inflation “Putin’s price hike” — a term the administration has used repeatedly.
(WASHINGTON) — The Federal Reserve is expected to raise interest rates significantly on Wednesday, escalating a strategy of increased borrowing costs that aims to dial back historic inflation.
Central bankers are expected to consider a rate hike of 0.75%, which would mark the largest increase since 1994. The potentially dramatic rate increase follows new inflation data that showed a reacceleration of price increases to levels not seen for more than four decades, dashing hopes that inflation had reached its peak.
The Fed is also expected to indicate that more rate hikes will follow in the coming months.
An increase to the benchmark interest rate raises borrowing costs for consumers and businesses, which in theory should slash inflation by slowing the economy and eating away at demand. But the strategy also risks tipping the economy into a recession. The rate hike will likely increase everything from credit card fees to mortgage rates.
The Federal Reserve raised its benchmark interest rate by 0.5% last month, and central bankers had signaled the same increase for June. But a persistent surge in costs appears to have prompted a reevaluation. The consumer price index, or CPI, stood at 8.6% year-over-year in May, a significant increase from 8.3% the month prior, according to data released by the U.S. Bureau of Labor Statistics on Friday.
A rate hike of 0.75% would bring the interest rate to a range of 1.5% to 1.75%.
President Joe Biden has touted the economic recovery from a coronavirus-induced downturn, but acknowledged that many American households are struggling with high costs.
“Jobs are back, but prices are still too high,” he said during a speech in Philadelphia on Tuesday.
Republican members of Congress have criticized Biden for the price hikes, suggesting they stem from his mismanagement of the economy. Biden has attributed high prices to the disruption of food and gas markets that has resulted from the Russian invasion of Ukraine, calling the sky-high inflation “Putin’s price hike” — a term the administration has used repeatedly.
(WASHINGTON) — President Joe Biden on Wednesday sent a letter to seven major oil refiners blasting them for record profits amid the war in Ukraine as Americans pay record prices at the gas pump.
In the letter, he informs them he has ordered Secretary of Energy Jennifer Granholm to convene an emergency meeting with company executives to provide an explanation of any reduction in refining capacity since 2020.
While acknowledging that “Putin’s war of aggression” has dwindled the world supply of oil, Biden also pointed out that oil company profit margins are at the highest levels ever recorded.
“The last time the price of crude oil was about $120 per barrel, in March, the price of gas at the pump was $4.25 per gallon. Today, gas prices are 75 cents higher, and diesel prices are 90 cents higher. That difference — of more than 15% at the pump — is the result of the historically high profit margins for refining oil into gasoline, diesel and other refined products. Since the beginning of the year, refiners’ margins for refining gasoline and diesel have tripled, and are currently at their highest levels ever recorded,” Biden wrote.
Biden blames on the companies for “worsening” the pain the war has imposed on Americans.
“I understand that many factors contributed to the business decisions to reduce refinery capacity, which occurred before I took office. But at a time of war, refinery profit margins well above normal being passed directly onto American families are not acceptable. There is no question that Vladimir Putin is principally responsible for the intense financial pain the American people and their families are bearing. But amid a war that has raised gasoline prices more than $1.70 per gallon, historically high refinery profit margins are worsening that pain,” he wrote.
He hinted his administration is prepared to take action if the companies don’t boost production, although the consequences of not complying are not clear.
“I am prepared to use all tools at my disposal, as appropriate, to address barriers to providing Americans affordable, secure energy supply,” he wrote. “The crunch that families are facing deserves immediate action. Your companies need to work with my Administration to bring forward concrete, near-term solutions that address the crisis and respect the critical equities of energy workers and fence-line communities.”
Asked on CNN Wednesday morning what “tools” are at Biden’s disposal, Granholm did not answer directly, but said his use of the Defense Production Act in other contexts has been on the table and that Congress can also take a variety of actions to address the issue.
She said he first wants to hear from the companies why “we are seeing these massive profit-taking on the part of refiners.”
When pressed repeatedly if a proposal from Sen. Ron Wyden, an Oregon Democrat, to impose a 21% surtax on excess profits form the oil companies is something Biden would consider supporting, Granholm nervously said “no tool has been taken off the table” but did not directly say whether he’d back the idea.
“I’m saying no tool has been taken off the table and he wants to hear from the refineries, the companies who are doing refining to see what is the bottleneck and how we can increase supply. And he’s also asking, of course, for the oil and gas industry to increase supply as well, by drilling more.”
Biden’s letter was sent to the Marathon Petroleum Corp; Valero Energy Corp; ExxonMobil; Phillips 66; Chevron; BP and Shell.
An industry group, The American Petroleum Institute, responded by trying to shift blame back to the White House, saying the administration’s “misguided policy” in reducing domestic oil and gas production has added to energy costs.
“While we appreciate the opportunity to open increased dialogue with the White House, the administration’s misguided policy agenda shifting away from domestic oil and natural gas has compounded inflationary pressures and added headwinds to companies’ daily efforts to meet growing energy needs while reducing emissions,” API President Mike Sommers said in a statement.
It urged the president to “prioritize unlocking U.S. energy resources” to reduce costs instead of increasing reliance on countries like Saudi Arabia.
ABC News’ Stephanie Ebbs contributed to this report.
(NEW YORK) — The U.S. Consumer Product Safety Commission issued warnings Tuesday after at least 14 deaths in recent years related to child rockers.
The warnings covered certain Fisher-Price and Kids2 rockers, and the agency warned consumers to not let their children sleep in the products.
CPSC reported at least 13 deaths between 2009 and 2021 of infants in Fisher-Price Infant-to-Toddler Rockers and Newborn-to-Toddler Rockers. It also reported one death in 2019 of an infant in a Kids2 Bright Starts Rocker.
“Parents and caregivers should never use inclined products, such as rockers, gliders, soothers, and swings, for infant sleep and should not leave infants in these products unsupervised, unrestrained, or with bedding material, due to the risk of suffocation,” CPSC said.
There are about 3,400 sleep-related deaths among babies each year in the United States, according to the Centers for Disease Control and Prevention (CDC) — a number the health agency says includes deaths due to “sudden infant death syndrome (SIDS), accidental suffocation in a sleeping environment and other deaths from unknown causes.”
“Fisher-Price recommends consumers visit Fisher-Price’s Safe Start webpage at www.fisherprice.com/SafeStart for safety videos, tips and additional safety information, as well as the latest safety warnings for Rockers and other infant products,” the company said in the CPSC statement Tuesday. The company added that it’s committed to the safety of its products.
Kids2 said in a statement on CPSC’s website that it encourages consumers to report incidents to the company and that its “number one priority is the safety and well-being of the babies and families who love and use our products.”
The CDC advises placing babies on their back for all sleep times; using a firm surface such as a mattress in a safety-approved crib; keeping soft bedding, pillows, bumper pads and soft toys out of the baby’s sleeping area; and having the baby sleep in the same room as a parent, but not in the bed.
A final rule issued by CPSC will go into effect later this month requiring sleep products to have a sleep surface angle of 10 degrees or less, and that all sleep products conform to the existing bassinet, crib, or play yard standards.
“Your infant’s sleep environment should be the safest place in your home,” CPSC Chair Alex Hoen-Saric said Tuesday.
Fisher-Price and Kids2 did not immediately respond to ABC News’ requests for comment.
(NEW YORK) — Prices for flights this summer have skyrocketed at unprecedented rates, and some travel experts say that travelers looking for deals should start planning for fall trips.
Domestic flight prices have jumped by 47% since January, according to an Adobe Analytics report released Thursday. The cost of domestic airfare also increased 6.2% from April to May, the report said.
“We expected to see elevated demand leading into 2022,” Patrick Brown, vice president of growth marketing insights at Adobe, said. “And consumers have been spending at twice the rate that they have over last year, but prices have grown even faster than the demand has grown.”
Brown also said the price increase “hasn’t dampened the demand for travel.”
“Despite the high increases in prices month over month, we’re seeing consumers still booking their travel while they’re looking for other ways to do it and getting creative about when to travel,” Brown said.
However, travel experts said there are still a few ways travelers can find affordable travel options or more room in their travel budget.
Scott Keyes, the founder of Scott’s Cheap Flights, said cheap flights “aren’t gone forever,” but they are for travelers looking to book this summer.
“It’s really too late to get a great deal for your summer travels, but that’s because it’s already June,” Keyes told ABC News.
Keyes said there are still “a ton of deals to be had” for those looking to book fall or winter vacations. For the same seven-day trip from Los Angeles to Maui, waiting a few months could save travelers more than 70%, according to Scott’s Cheap Flights.
“Flights on July 1 through 8 from Los Angeles to Maui are $725 roundtrip,” Keyes said. “But flights from L.A. to Maui on Sept. 1 through 8 are just $161 round trip.”
But Keyes says to get those deals, travelers need to book now.
“My recommendation is book those fall flights now while fares are really cheap and give yourself a trip on the books to look forward to that you get to daydream about,” Keyes said.
For travelers who have already booked flights or are still looking for destinations, the strength of the U.S. dollar could mean more bang for your buck in some foreign destinations, according to Haley Berg, an economist at the booking platform Hopper.
“The dollar has appreciated compared to many local currencies, Mexican pesos is one of them,” Berg said. “So many of those Central American and Caribbean countries might be more attractive to visit this summer than in previous years as well.”
The U.S. dollar’s strength will especially benefit travelers to Europe this summer, where the Euro has depreciated by nearly 15%. Berg said that even though prices for airfare to Europe are up, the dollar parity will help travelers stay in budget.
“When you’re there shopping, staying at hotels, eating out, your dollars will go about 6% further than in 2019,” Berg said.
