Although the Federal Reserve’s 10 rate hikes in the past 15 months have helped bring down persistent inflation, select goods are becoming more expensive, reports The Wall Street Journal. While prices for meat, eggs, and produce have stagnated, the cost of center store items are on the rise.
Potato chips, for example, rose 17 percent in price to $3.05 per package for the 52 weeks ended May 27, compared to last year, according to NielsenIQ. Over the same period, the price of mayonnaise went up 23 percent, and applesauce, 22 percent.
Retail executives are resisting further inflated prices from packaged food giants and pushing for lower prices. Price increases for dry groceries are putting pressure both on retailers and consumers.
“We all need those prices to come down,” Walmart CEO Doug McMillon told investors in May. “The persistently high rates of inflation in these categories lasting for such a long period of time are weighing on some of the families we serve.”
CPG giants have cited labor, transportation, and ingredient cost increases as justification for the new prices. Slowing sales growth, weaker volumes, and more discounts on the horizon also incentivize companies to resist lowering their prices, according to the report.
Consumers have pushed back on the rising prices, opting for cheaper replacements for certain packaged groceries. Full Story (Subscription Required)
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