The latest consumer price inflation data confirms what we all know – it costs more to eat during the pandemic, but it costs a lot less to drive to your favorite closed restaurant.
Using February as the base month – the high point for the “all Items” consumer price index – the cost for food made at home is 3.6% higher than before the economic shutdown. Food purchased away from home now costs 2% more than it did in February, and food in general costs 2.8% higher.
By comparison, consumer energy costs are 9.6% lower now than they were in February, which is one reason why risks to the outlook remain skewed toward disinflation or deflation and why inflation expectations remain well anchored.
This speaks to the inequality of the pandemic, which has hit the poorest among us the hardest. While for those of us able to work at home, the rising costs of food products are noticeable but financially insignificant, at least relative to a laborer without a job or with reduced hours.
For more information on how the coronavirus is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.