Inflation is going down. Many Americans say they're still struggling.

Inflation isn't letting up for Elizabeth Martin.

“Everything still feels high, that’s what is on the top of my mind right now,” said Martin, a product designer from Oakland, California. “My water bill is higher than a year ago. My electricity bill is costly too. I'm spending over $100 a month more on both. So, I don’t see a difference."

Many Americans express a similar sentiment even though annual inflation in the U.S. slowed to 3% last month, according to the June consumer price index released Wednesday by the Bureau of Labor Statistics. Inflation, as measured by the index, has now eased for 12 straight months and is at its lowest rate since March 2021.

That's a significant decline from a year ago when inflation hit a 40-year high of 9.1%. But it's apparently still not enough for many consumers after a historic two-year price run-up.

Inflation is still on America's mind . . . and for many, it's not because prices are getting more manageable.

"I haven't seen that at all," said Dot Stagner as she rolled her full grocery cart outside a supermarket in Morgan Hill, California.

A 'turning point' on inflation?

Still, many Americans are relatively optimistic about the economy and inflation, said John Leer, chief economist of Morning Consult, a research firm that surveys consumers on their views of the economy.

"That largely reflects the turning point that we’ve seen on inflation," Leer said. He cited the tumbling cost of some products, with egg prices down more than 20% since April, adding, "It’s a small share of wallet but has an outsize impact on people’s views."

Prices for most goods and services, of course, aren’t falling, simply rising more modestly. Yet many Americans are benefitting from strong wage growth that recently started outpacing price increases, Leer said, giving shoppers more purchasing power. “That’s a pretty big change,” he said.

As a result, middle- and higher-income Americans are now more willing to pay higher prices, driving a surge in hotel and air travel spending, according to Leer and a recent Morning Consult survey. That group also can substitute grocery purchases, for example, for pricey restaurant visits.

But lower-income households have less wiggle room and are still struggling because of the cumulative effects of inflation on their finances the past couple of years, Leer said.

'I'm counting every penny even more'

Martin said she began her belt-tightening a year ago, which meant not going out for dinner and drinks twice a week with friends and saving upward of $100. Now she’s doing more entertaining at home.

What she initially thought was going to be a temporary solution is now the norm.

“I grab some beer and food at the store and cook for them,” she said. “I’ve always been pretty tight with my money, but now I’m counting every penny even more.”

'There's no bang for your buck'

Rasheed Matthew is not waiting around to see if inflation will ease rental prices.

Last month, he gave up an apartment he was sharing with a friend in Brooklyn, New York, when the rent shot up 23%, from $5,100 to $6,300. After a two-week vacation in Europe, Matthew, 25, a software engineer for a bank, decided to move in with his family in the Bronx.

“I've been looking for several months now, but I can't even find a place now because everything is so expensive,” Matthew said. “Especially for what you're getting… there’s no bang for your buck.”

Matthew wants to live within commuting distance of his Manhattan job but no longer looks in Brooklyn.

“Brooklyn is too expensive, so I’m looking in South Bronx or the outskirts of Long Island City (in Queens),” he said.

Commuting to Manhattan is an expense Matthew said he wishes he could avoid. But his employer has required workers to return back to the office three days a week.

“I mean, I just paid $13 for some halal food. I didn't even eat all of it,” he says. “In the Bronx or somewhere in the outskirts, it may be $8, or $9. So inflation is through the roof just for lunch.”

Matthew says working remotely during the pandemic was a seamless experience for him, so he doesn’t understand why some employers are forcing workers to return to the office – particularly in an inflation-weary economy. “I understand it’s good for the local businesses, but we have so many tourists, and we pay New York taxes,” he said.

“We shouldn't be forced, it’s like we're being bullied.”

Tough to be a renter, even harder to become a homeowner

Yoyo Lin, 35, was taking a break from leading a tour group at Hudson Yards in Manhattan on Wednesday afternoon. She has been living in Flushing, Queens, for the past 10 years and has seen no let-up in her rent.

In March, her landlord raised it by 10%. She now pays $2,625 for a two-bedroom apartment she shares with her husband, plus $300 for parking. "He keeps increasing the rents, even though we have been great tenants," Lin said.

The only place where she’s seen inflation slowing down is in the cost of some of her groceries at the Asian greengrocer she frequents. “Tomatoes used to be $3.49 a pound and now it is $1.79,” she said.

Lin hopes to buy an apartment in a co-op building. But with mortgage rates climbing above 7% and home prices not really budging, she doesn’t see that happening anytime soon. She’s also not able to save much.

“Before, when we went to Costco, if we spent $100, we could buy a whole cart," Lin said. "Right now, $300 is nothing, you know? Expenses have been going up since COVID.”

Despite the improvement in the inflation data, it could take many Americans six to 12 months to feel better about their financial situation. "It's just a matter of people's perceptions rising to the reality," said Mark Zandi, chief economist of Moody's Analytics.

This article originally appeared on USA TODAY: Inflation is going down. But Americans say they life isn't easier