Wednesday, January 13, 2021

Food Prices Soaring



The latest data from the Bureau of Labor Statistics shows 12-month food prices climbing at a 3.9% annualized rate for 2020.

Overall price inflation for the same period, as measured by the government's Consumer Price Index, rose 1.4%.

Bottom line: The goods people are buying during this lockdown period such as food are soaring.

The advance in food prices was pretty much across the board.

All sub-categories from cereals to fruit showed gains far in excess of the Federal Reserve's "target" inflation of 2.0%. But, hey, if you don't eat, price inflation is not as high.



In the EPJ Daily Alert, I am warning that as the lockdowns ease, price inflation across the board will rise to meet the advance in prices we are seeing in food prices.

Hug your gold coins.

-RW

2 comments:

  1. These numbers are surprisingly low. Meat prices felt like they've gone up way more than 4-5%.

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    Replies
    1. Do they still use substitute goods? So if ribeye is up, say, 15%, but chuck roast is up 5%, they'll use chuck roast and just ignore ribeye in the calculation?

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