CPI Report Live Updates: Inflation Cooled More Than Expected in October


Food prices continued to grow in October, inflating grocery bills for American households, though at a slightly slower pace than in previous months. The price of food rose 0.6 percent last month, down from 0.8 percent growth in September.

While prices of some items have retreated after spiking earlier this year, others are reaching fresh highs. The price of cereals and bakery products climbed 0.8 percent from the previous month, driven by a 2 percent increase in the price of flour. Lunch meats rose 3.4 percent from September and lettuce increased by 3.3 percent. The price of eggs, which have been inflated this year because of an outbreak of avian flu, soared 10.1 percent on the month.

But the price of some products began to fall after peaking earlier this year. The price of frankfurters fell 2.3 percent. Whole milk fell 0.9 percent, and fresh fruits declined 2.4 percent.

On an annual basis, the food index rose 10.9 percent, down slightly compared with the pace of growth last month.

The rising price of food is one of the most tangible manifestations of inflation for many households, particularly for lower-income Americans who spend more of their income on groceries. Food price increases have been particularly stubborn because they are driven by a wide range of factors, including higher costs for fertilizer, fuel, packaging and workers throughout the food supply chain.

Drought and extreme temperatures linked to climate change and La Niña weather patterns have weighed on yields of corn, soybeans, lettuce and other crops, helping to push up prices. And Russia’s invasion of Ukraine has disrupted exports of wheat, sunflower oil and other agricultural products, prompting shortages and pushing up food prices globally, particularly in the Middle East and Africa.

Restaurant prices have also risen, outpacing the price gains at grocery stores in recent months, due in part to rising costs for labor. An index measuring the price of food at restaurants was 0.9 percent monthly, while an index measuring the price of food at home gained 0.4 percent from the previous month, the smallest monthly gain seen since December 2021.

The U.S. Department of Agriculture has said that it expects food prices to grow more slowly next year, though still at historically high levels.

Sara Menker, the chief executive of Gro Intelligence, an analytics company, said that sharp increases in the price of many agriculture commodities had taken some time to work through the supply chain, as major companies that produce packaged food for grocery stores raised their prices in response to increases in their costs.

“It takes a while to play out through the economic system,” she said. But she added that the year-to-date price changes for certain products “are just insanely high,” pointing to vegetable oils as well as volatile movements for certain produce items.

“I hope you don’t love cucumber,” she said.



Read More: CPI Report Live Updates: Inflation Cooled More Than Expected in October

2022-11-10 06:36:53

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