San Diego County Inflation Drops to Lowest Rate in Over a Year

Declining gas prices and housing costs drive the region's inflation rate down, but it remains higher than the national average.

Published on Feb. 13, 2026

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San Diego County's inflation rate dropped to 2.6% in January, its lowest level in more than a year, according to the U.S. Bureau of Labor Statistics. This was driven largely by declining gasoline prices, as well as decreases in the costs of used cars and trucks, and meats, poultry, fish, and eggs. However, the region's inflation rate is still higher than the national average of 2.4%.

Why it matters

San Diegans have been hit with some of the highest inflation rates in the nation since the pandemic began, with housing costs being a major factor. This drop in the inflation rate, while an improvement, still leaves consumers in the region struggling with rising prices, especially for housing and other essential goods.

The details

San Diego County's inflation rate fell from 3.7% in December to 2.6% in January, the lowest level since late 2024. Gasoline prices were down 1.5% from a year earlier and 8.4% lower since November. Other big price drops were in used cars and trucks (-2.5%) and meats, poultry, fish, and eggs (-1.6%). However, housing costs, which include rent, household items, and homeowner expenses, were up 3.7% in the region compared to 3.4% nationally. Prices for household furnishings also rose 6.4% annually, likely due to the impact of tariffs.

  • San Diego County's inflation rate dropped to 2.6% in January 2026.
  • The region's inflation rate was as high as the first or second highest in the nation for the last six months of 2025.

The players

Alan Gin

An economist at the University of San Diego who says the drop in San Diego's inflation rate is "a little bit of an improvement," but it's still higher than the national level.

Eesha Sharma

A marketing professor at San Diego State University who says consumers' perception of decreased wealth, in part driven by inflation, can affect their spending patterns throughout the region.

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What they’re saying

“(The San Diego rate) is a little bit of an improvement, but it's still higher than the national level.”

— Alan Gin, Economist, University of San Diego (San Diego Union-Tribune)

“San Diegans who feel more financially constrained, she said, may be inclined to stockpile goods because they expect prices to go up more, in addition to cutting down on purchases.”

— Eesha Sharma, Marketing Professor, San Diego State University (San Diego Union-Tribune)

The takeaway

While the drop in San Diego's inflation rate is a positive sign, the region's consumers are still grappling with higher prices, especially for housing and other essential goods, compared to the national average. This highlights the ongoing economic challenges faced by San Diegans and the need for continued efforts to address the root causes of inflation in the region.