Why are groceries still so expensive?
FOX Business’ Kelly O’Grady provides analysis of the U.S.’s inflation data as the Federal Reserve continues to grapple with a smooth economic recovery.
Inflation is falling faster than most economists expected, but steep food prices are still taking a large bite out of Americans' budgets.
Grocery prices have surged more than 21% since the start of 2021, outstripping the overall 18% pace of inflation during that same time period. And while the pace of price increases for food has slowed in recent months, the overall cost of many grocery store staples is still marching higher. Experts say that relief for consumers is unlikely to arrive anytime soon.
«Prices very rarely go back. There's disinflation, meaning the rate of increase slows down. But the way we dig ourselves out of this is that people make more money above the rate of inflation,» Robert Frick, corporate economist at Navy Federal Credit Union, told FOX Business. «That's happening now, but it's not a quick solution. It's going to take two or three years before people feel real relief from the surge in inflation, especially with things like food.»
Food has been one of the most acute inflation pain points for Americans. More than two-thirds of voters say that inflation has hit them the hardest through higher food prices, according to a survey published by Yahoo Finance/Ipsos in November 2023. That is more than 50 percentage points higher than any other category, including gasoline, transportation costs and housing expenses.
HIGH INFLATION IS STILL SQUEEZING AMERICANS' BUDGETS
A shopper makes their way through a grocery store on July 12, 2023, in Miami, Florida. ((Photo by Joe Raedle/Getty Images) / Getty Images)
Rising food prices are concerning because those
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