Your Incredible Shrinking Grocery Store Receipt
It may feel like life just gets more expensive all the time, but guess what? The amount of money you’re shelling out for groceries these days may actually be going down. Yes, down.
Over the past nine months, U.S. food prices have plummeted in what Bloomberg reports is “the longest streak of food deflation since 1960” (except the one in 2009, as the Great Recession was tapering off). Thanks to lower oil and grain prices and greater competition in the discount-grocery category (Wal-Mart, Target, Aldi, Amazon and even your local dollar store), Americans are saving big at the checkout, and retailers are absorbing the difference.
Most noticeably cheaper: eggs and beef. The dozen large eggs you paid 99 cents for this week may have cost you three times that just last year. And beef? Grocery chains are trying to outdo each other on savings. Buy-one-get-one offers on better meat cuts, which not long ago would have been unheard of, are now not unusual at all.
Scott Mushkin, an analyst at Wolfe Research and grocery-price expert, told Bloomberg the price declines were “completely unprecedented,” in terms of degree. In Houston, he noted, a typical grocery shopping trip may cost consumers as much as 5 percent less than it did a year ago. “We’ve never seen deflation this sharp,” Mushkin added.
Bloomberg Intelligence analyst Jennifer Bartashus said the rock-bottom prices were almost “irrational.” Supermarkets, she said, were “lowering prices just to draw traffic, without thinking about their margins.”
Their loss is your wallet’s gain.