Walmart Executives Predict How Long ‘Stubborn’ Food Inflation Will Last
Walmart executives projected during an investors call on Tuesday that food inflation will remain persistent for the foreseeable future.
Even as headline inflation statistics declined from 9.1% in June 2022 to 6.4% in January 2023, an increase in food prices has been especially salient for households attempting to make ends meet, according to recent data from the Bureau of Labor Statistics. Costs for food at home increased 11.3% between January 2022 and January 2023, while costs for food away from home rose 8.2% over the same period.
An analyst asked Walmart U.S. CEO John Furner and Walmart CEO Douglas McMillon during the grocery behemoth’s fourth-quarter earnings call whether the company expects food inflation trends to worsen or improve relative to other product categories. Furner remarked that food inflation “has been the most stubborn” driver of elevated price levels and noted that only “a little bit” has declined in the past several months. “We would have hoped and expected it to have come back more than it has going into this year,” he responded.
McMillon added that dry grocery items and consumables are the most “stubborn” and said that inflationary pressures in the categories would “be with us for a while.” He went on to say future nominal disinflation would nevertheless compound price increases from previous years.
“You’ll probably hear inflation numbers that start to sound lower, but you’ll have to remember that’s on a two-year stack,” McMillon continued. “So if inflation in dry grocery and consumables is only 3% or 5%, that’s on top of 15%. And that’s still a problem for the customer and still a pressure to their wallet.” (Read more from “Walmart Executives Predict How Long ‘Stubborn’ Food Inflation Will Last” HERE)
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