The cost of groceries edged up 0.1% for the second month in a row in July, led by increases in the cost of beef, eggs, milk and fresh produce.
The overall Consumer Price Index rose 0.2% last month, primarily because of a 0.4% increase in housing costs, the Bureau of Labor Statistics reported Wednesday.
The index for food eaten at home is up 1.1% from July 2023.
Consumers continue to see significantly more inflation eating out. The index for food eaten away from home, which is significantly affected by labor costs, rose 0.2% in July and has increased 4.1% over the past year.
Inflation at the supermarket is expected to continue decelerating into 2025. USDA’s Economic Research Service is forecasting that grocery prices will be up 1% in 2024 over 2023 and only 0.7% in 2025.
ERS projects that the cost of food eaten at home will be up 4.3% this year and another 3% in 2025.
Some food categories continue to see significant inflation. Egg prices, which have been significantly affected over the last several years by outbreaks of avian influenza, rose 5.5% in July and are up 19.1% over the past year.
The price of beef, which remains elevated due to tight cattle supplies, rose 1.2% last month and is 4.5% higher than a year ago. Meanwhile, the price of chicken rose just 0.1% in July, and the cost of pork was down 0.2%.
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The index for dairy products also was down 0.2% in July but that was in part because lower prices for ice cream helped offset a 1.9% price increase for milk and a 0.3% cost increase for cheese.
The overall index for fruits and vegetables rose 0.8%, led by higher prices for tomatoes and citrus that contributed to a 1% increase in the overall cost of fresh produce.
The index for cereals and bakery products was down 0.5% in July, led in part by a 1.1% drop in the cost of bread.
Even as it moderates, food inflation continues to be an issue in the presidential election. Republicans blame federal spending under President Joe Biden, while Democrats say corporate market power is at fault.
Andy Harig, vice president for tax, trade, sustainability and policy development at FMI-The Food Industry Association, which represents major supermarket chains, said the July CPI for food at home shows “the pace of year-over-year inflation continues to moderate, with food prices remaining a bright spot in the data relative to other sectors like shelter and transportation services.”
The report “demonstrates that eating at home continues to be an economical way for families to manage their food budgets.”
