Journal Article

Commodity Prices Have Limited Influence on U.S. Food Inflation

Abstract: Food prices increased at the fastest pace in more than two decades from July 2021 to July 2022. We show that this increase has not been driven by commodity prices but by an increase in consumer spending on food at home and increases in costs along the supply chain. Our results suggest that food inflation could ease if consumers shift more purchases back to food service establishments and if costs in food processing and marketing abate. Conversely, food inflation could remain high if broader measures of inflation persist.

Keywords: Prices; Consumers' expenditure; Inflation (Finance);

JEL Classification: E31;

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Bibliographic Information

Provider: Federal Reserve Bank of Kansas City

Part of Series: Economic Bulletin

Publication Date: 2022-09-23

Issue: September 23, 2022

Pages: 4