During the pandemic, the consumers shifted from spending on services to goods but now it appears to be reversing as the infection rate is waning. Consumers shopped more online in the pandemic, and they bought things for homes such as furniture and computers so that they could work from home, and the spending on goods was aided by federal stimulus. According to a corporate economist with Navy Federal Credit Union, the falling infection rates help people feel more comfortable socializing in person, and he also predicts that the demand for services such as travel, and dining should recover soon. This could be important for inflation as high demand for goods along with supply-chain disruptions have kept the prices high. Prices for furniture and appliances rose 10.7% in December, whereas services inflation for costs such as rent, and airline fares were up a more moderate 3.7%. Therefore, if consumer spending shifts back to services, the upward pressure on goods prices should dissipate.
https://www.wsj.com/articles/consumers-are-pivoting-spending-to-services-like-dining-and-travel-11643797808
I definitely do not think that the demand for goods will stay where it is. In fact, I would be willing to bet that it will decrease below where it was before the pandemic. People will not need to spend money on the things which they bought due to the pandemic and demand for goods will see a drop for sure.
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