Grocery Prices skyrocketing, consumers are losing fight against inflation

USPC · Mar 9, 2023

Grocery Prices skyrocketing, consumers are losing fight against inflation

Persistent inflationary pressures in the U.S. economy have kept prices for groceries high even as inflation has eased somewhat in other sectors of the economy.

The Bureau of Labor Statistics‘ monthly consumer price index (CPI) report for January was released last week. The report showed that prices for food at home – classified as food bought at the store to be prepared at home – were up 11.3% compared to last year. That figure is well above the overall inflation number, which came in at 6.4% year-over-year as of January and is down from a 40-year high of 9.1% in June 2022.

The high cost of groceries hits fixed- and low-income families particularly hard. For those receiving Social Security, the 8.7% cost-of-living-adjustment that took effect in January 2023 – which is the largest since 1981 and boosted the average monthly benefit by about $140 – still leaves beneficiaries with relatively less income for groceries compared to a year ago even with the cost-of-living-adjustment.

Inflation continues to persist in the economy despite the Federal Reserve’s interest rate hikes. Last week’s inflation report showed that the CPI increased by 0.5% in January after a surprise decline of 0.1% in December’s reading but the Fed has a target to lower this by 2%.

“Unfortunately, it is likely that food prices will remain elevated in the short term, and we anticipate that there could be further volatility in terms of inflation rising and falling in the coming months. Yet we continue to remain cautiously optimistic that the worst of food price inflation is behind us.” says Andy Harig from Sustainability and Policy Development.

Harig added that the survey conducted by the departed found shoppers are spending an average of $151 per week on food. The pandemic peak was $161 per week, and noted, “To help consumers stretch their food dollar, grocers have dramatically increased investment in their store brand offerings, among other strategies.”

The U.S. Dept. of Agriculture’s (USDA) Economic Research Service (ERS) projected in January that food prices will grow more slowly in 2023 than they did in 2022, although prices will remain above historical averages.

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Grocery Prices skyrocketing, consumers are losing fight against inflation

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