US retail and out-of-home food inflation has slowed below 10% for the first time since last April.
Prices rose 9.5% in February from a year earlier, the lowest since 9.4% in April last year and below January’s rate of 10.1%, the US Bureau of Labor Statistics reported. USA in its latest inflation figures. The cost of food has now fallen for six straight months after reaching a peak in August of 11.4%.
However, when breaking down the food index of all items into food at home and eating out, the cost of a grocery store increased 10% from a year earlier in February. Prices in a restaurant or food outlet rose 8.4%.
Cereals and bakery led the annualized increase in retail food, increasing 14.6%, with prices for other goods ranging between 5.3% and 12.4%.
The headline inflation rate covering all goods cooled to 6% last month, from 6.4% in January, but remains well above the US Federal Reserve’s target rate of 2%. on an annualized basis. However, it has declined for eight consecutive months from 9.1% in June.
Some food manufacturers are still targeting elevated prices for the rest of the year and some are indicating further price increases to recoup costs as they continue to work through Covid supply chain pressures.
The protracted war in the Ukraine is also creating headwinds, but the costs of food staples are coming down, forcing food producers to work through previously placed hedging contracts. It also emerged this week that Russia is about to extend the Black Sea grain deal, which would allow continuous passage of food inputs such as wheat and corn from three Ukrainian ports.
Prices are also down in the US on a month-to-month basis. The headline inflation index was 0.4%, from 0.5% in January.
For food, month-on-month inflation stood at 0.4% in the US in February, up from a 0.5% increase in the previous month. Non-alcoholic beverages rose 1%, cereals and pastries 0.3%, and fruit and vegetables 0.2%. Dairy prices rose 0.1%.
On the protein side, prices fell, with the tracking index for meat, poultry, fish and eggs falling 0.1%, the first decline since December 2021, the Bureau said.