Inflation breaks 3.8 percent, with groceries leading the way; more to come, economists warn
Groceries post the worst month since 2022
The April consumer price index landed Tuesday morning at 3.8 percent, the hottest annual inflation reading since May 2023, and consumers spent the rest of the day watching the dominoes fall. Grocery prices posted their sharpest monthly jump in nearly four years.
Food-at-home prices rose 0.7 percent in April, the biggest monthly jump since August 2022, The Associated Press reported. Year over year, food at home was up 2.9 percent and overall food prices climbed 3.2 percent — above the 2.6 percent 20-year average tracked by the U.S. Department of Agriculture.
The leaders were the staples shoppers see most often.
Meat prices rose 8.8 percent from a year earlier,
beef was up 15 percent,
fresh fruits and vegetables 6.5 percent,
nonalcoholic beverages 5 percent and
coffee 18.5 percent, the AP said.
Tomatoes imported from Mexico — hit by a 17 percent duty the Trump administration imposed last year — were up 40 percent at retail in the 12 months before April. Butter, by contrast, was 5.8 percent cheaper and egg prices were down 39 percent as farmers rebuilt flocks decimated by bird flu.
Prices still rising
“The full impact of rising energy costs on food likely has not hit retail grocery prices yet,” Ken Foster, a professor of agricultural economics at Purdue, told the AP, noting that higher costs to produce, process, store and transport food typically take three to six months to show up on shelves. Most of April’s increase, Foster said, “probably predates the conflict” with Iran. The next two reports, he warned, will start to capture it.
Raymond Campise, who owns Sparrow Market in Ann Arbor, Michigan, told the AP that vendors have begun tacking fuel surcharges onto deliveries in recent weeks and that wholesale prices for meat, produce and several other categories have moved up. The AP noted that diesel powers the boats, tractors and trucks that ship 83 percent of U.S. agricultural products, and that roughly 30 percent of the world’s fertilizer normally moves through the Strait of Hormuz.
That broader basket builds on a packaging story the same Times reported a day earlier: a 50 percent tariff on imported steel is pushing up the wholesale cost of tin-plated cans that hold corn, beans and tomatoes, The New York Times said, with the can itself representing roughly one-third of wholesale cost.