Travel Inflation Report: August 2025

For the fifth month in a row, travel costs are down. That's largely driven by a drop in hotel room rates, which are down 4.8% over the past year.

All in all, average U.S. travel costs are 1% lower than they were this time in 2024, according to NerdWallet's Travel Price Index, which combines data from individual travel categories tracked by the Bureau of Labor Statistics' (BLS) Consumer Price Index, such as airfares, lodging, meals and rental cars.

While hotel rates are down, other travel categories are ticking up modestly, with airfares and car rentals up 0.7% over the past year. But that 1% decrease is still good news, as overall prices for the past 12 months through July 2025 rose 2.7% before seasonal adjustment, according to BLS data.

But even if prices are lower based on the data versus last year, that doesn't mean traveling is cheap. Even so, there are some smart moves you can take now to reduce the price of your next trip. Check out our money-saving travel suggestions below.

The Travel Price Index shows a 1% decrease in travel prices from July 2024.

Relative to pre-pandemic prices, July 2025 travel costs are up just 9% versus July 2019 (the last full equivalent month before the 2020 COVID-19 pandemic). That's far lower than the 26% price increase across all items.

Not every product experiences inflation at the same rate — especially when it comes to travel. Some trips might actually be more or less expensive than in the past, depending on if you're driving versus flying, if you’re staying in a hotel and whether it involves a rental car.

To help you better understand how travel prices have changed, NerdWallet honed in on five categories:

• Airfare.

• Car rentals.

• Food away from home.

• Hotels.

• Movies, theaters and concerts.

NerdWallet then compared those costs to prices from one month and one year earlier.

And to broaden the perspective, the data also compares today’s prices to prices 10 years ago. Here’s what today’s travel prices look like:

When comparing July 2025 prices to June July, U.S. airfares are up by 0.7% — the first time since January that costs have been higher compared to a year ago.

However, if you zoom out, the outlook is rosier: Compared to prices 10 years ago, airfares are actually down by 16.6%. It's pretty unheard of for prices to drop over that period of time, especially considering that the prices for all items tracked by BLS are up 35.3% over that same period.

So if airfares are down over the past decade, why do they feel so high? There are a few reasons, including unbundling, where airlines advertise lower fares (often in the form of basic economy seats that offer few frills).

But low base fares typically come with upcharges in the form of ancillary fees to check bags, to guarantee a window seat or for early boarding. Those extra prices are not captured in this data — despite it still impacting one’s travel budget.

Average U.S. hotel and motel room rates are down by 4.8% over the past year. That's good news for travelers, as it means they can generally expect to pay less for the same hotel room this year than they did last year.

Compared to 10 years ago, travelers may be feeling the pinch though, as hotel room rates are up 12.3% over the past decade. However, that's still a good deal less than the 35.3% increase across all items.

High rental car prices were one of the biggest stories of pandemic-era travel. But after a huge spike, prices have largely come down from the peak — although they remain much higher compared to before the pandemic.

In July 2025, rental car prices are up 2.5% versus the month prior and up 0.7% compared to the year prior.

Food prices consistently rise nearly every month, and this month was no exception. In July 2025, the cost of food away from home was up 3.9% versus the same month in 2024.

The cost of dining out has increased dramatically in the past decade, with July 2025 prices 50% higher than what they were in June 2015. That's higher than the 35.3% inflation rate across all items, meaning restaurant prices have risen more than many other categories of goods.

Tickets for movies, theaters and concerts are also rising faster than the average rate of inflation, up by 3.8% over the past year. With the cost of dining and entertainment outpacing the rate of inflation, that could suggest that Americans are prioritizing experiences over physical things.

Paying for travel with points and miles versus cash isn’t as daunting a task as it may seem. Frequent flyer miles and hotel points can be accrued not just for recurring travel, but through other outlets as well. Credit card rewards and welcome bonuses can be one of the most popular ways to accrue a big stash of points for a lot less effort than living your life out of a suitcase.

In addition, travel credit cards can offer various money-saving perks, like:

• Complimentary trip insurance.

• Savings on checked bags.

• Waived foreign transaction fees.

• Airport lounge access.

• Cash back credits that can offset the annual fee.

Here are some of the best credit cards that offer travel-related statement credits.

If you’re building your next vacation budget based on how much you spent last year, you might need to factor in spending more on certain categories like eating out and car rentals. Fortunately, you can still save on travel with a little planning.

To avoid the costs of eating out, head to local grocery stores — which can be a fun activity on its own — or pack snacks from home. While in an airport, head to the lounge. Many credit cards have partnerships with airport lounge networks (Priority Pass is a popular one) where you can typically expect complimentary snacks and drinks.

Methodology

NerdWallet conducted an analysis of the Bureau of Labor Statistics’ Consumer Price Index data released by the U.S. Department of Labor, which was most recently updated in August 2025 and measures prices of items like travel, groceries and cars. Some prices change more than others.

Keep in mind, this data is based on July 2025 information, even though it is released in August 2025. Prices you see may have increased or decreased compared to this data, because it lags one month behind.

And even within the realm of travel, some expenses might go up, while others might go down.

The NerdWallet Travel Price Index combines data from the Consumer Price Index, weighted by the estimated spending in each category, which is based on 2019 travel expenditure data from the BLS.

Here are the spending categories considered, and how heavily each was weighted:

• Flights: 36%.

• Car rental: 6%.

• Lodging: 30%.

• Food: 21%.

• Entertainment: 7%.