First, sharp increases in the prices of oil and other commodities eroded the purchasing power of households’ incomes, thus restraining their spending. Gasoline and food prices surged, and a portion of producers’ higher input costs were passed through to the prices of a wide range of consumer goods and services.
Second, the production and sale of motor vehicles declined sharply because of disruptions in global supply chains in the aftermath of the disastrous earthquake and tsunami that struck Japan last March. These supply disruptions also limited the availability of some popular models, placing upward pressure on motor vehicle prices.