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Americans struggling to afford groceries due to increasing prices

Consumers are still worried about inflation, and one place where folks feel the pinch is in their regular trips to the grocery store.
Americans struggling to afford groceries due to increasing prices
Posted at 6:20 PM, Apr 12, 2024

New numbers show consumers aren't changing their feelings much about the economy compared to last month. The University of Michigan's Surveys of Consumers data came out Friday, and the Consumer Sentiment Index came in at 77.9%.

That measurement is down 1.9% from last month. The University considers that a small change, saying it shows consumers perceived few meaningful changes in the economy.

One area in which consumers have been paying close attention is in the cost of certain products most families buy. This week's 3.5% year to year increase in the Consumer Price Index was pushed by higher costs for gas, housing and car insurance — but another place folks feel the pinch is in their regular trips to the grocery store.

"I went grocery shopping this morning and I spent 150 bucks," said Hannah Cupples, a private chef and owner of For Chef's Sake based in Colorado. "But I mean, that puts my monthly grocery budget at like 5 or 600 bucks. That's a lot of money."

When it comes to prices, many are finding the cost of groceries hard to swallow.

"I can make one chicken into four or five different meals," Cupples said. "But the other thing that comes with that is I have the luxury of time on that, that most people don't have because a lot of this is my job."

The Bureau of Labor Statistics said this week overall food prices were flat between February and March, giving consumers some relief.

Year-over- year, the Fed reported that groceries were up by 1.2%. But an analysis by the St. Louis Fed shows food-at-home costs are up nearly 25% since the pandemic shutdown in March of 2020.

SEE MORE: Inflation rate ticks higher, could delay interest rate drop

"Of course, there are goods which have increased as much as 10%, or even 21% in the case of say, fruits, for example, or eggs and milk," said Kishore Kulkarni, an economist at Metro State University of Denver.

Kulkarni said factors over recent years like drought, avian flu, labor costs and the lowest cattle numbers in decades have led to increased food prices.

"So, the goods that have to be shifted from one location to another tend to have a much higher price," Kulkarni said. "So, even the California fruits and vegetables are getting more expensive. So those are the reasons why specific items will have a much higher, or sometimes even lower increase in price than the general price."

Savvy shoppers know food prices are extremely volatile. The price of eggs between February and March, according to the CPI report, rose 4.6%.

But year-to-year eggs are down nearly 7%, while fruits and vegetables jumped 2% annually, whole chickens are up 3% and ground beef is 6.2% more expensive.

And for food away from home, the bill is 4.2% up over last year.

"I think restaurants are feeling that more than most places," Cupples said. "There are certain levels of restaurants where things are already out of most people's price ranges that the second that they start to go up beyond that, I mean, you're cutting out 75% of your client base."

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