US consumers may finally be getting some relief from their grocery bills — especially if they shop for food online.
Data by Adobe Inc. shows that online grocery prices fell 3.7% in August from a month earlier, the largest decline since the firm began tracking the numbers in 2014.
Online grocery shopping accounts for about 12% of the national total. While prices swing more dramatically than they do for in-store purchases, the overall direction has tended to be similar.
The spike in grocery prices since 2020 has been one of the most painful elements of pandemic inflation for American households. While food for consumption at home only represents about 8.6% of the official US inflation measure, it’s a day-to-day purchase that can’t easily be postponed, and for millions of families it accounts for a large chunk of the budget.
The issue has played a prominent role in the presidential election campaign. Republican candidate Donald Trump has been pointing to the more than 20% cumulative increase in food prices since the Biden administration took office. Vice President Kamala Harris’ campaign has promised measures to stop “price gouging” by grocery stores.
The rise in prices has largely leveled off in the past year or so, and there are signs that consumer expectations are adjusting. According to a Federal Reserve Bank of New York survey released Monday, the median expected price increase for food in the year ahead declined to 4.4% in August, roughly the same as in the pre-pandemic years.
Overall, online prices fell 4.4% in August from a year earlier, the 24th consecutive month that they’ve posted an annual decline, according to Adobe’s Digital Price Index.
The gauge is created by analyzing data from 1 trillion visits to retail sites and over 100 million product codes across 18 categories. The methodology behind the index was developed with guidance from Austan Goolsbee before he became president of the Federal Reserve Bank of Chicago.
Written by: Alexandre Tanzi @Bloomberg
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