Food price inflation is back in the outlook for all food, food at home (grocery) and food away from home (restaurant) prices in 2024, according to the latest update from USDA. Food prices are expected to increase 2.9% in 2024, a significant jump from the previous outlook of just 1.3%. Grocery prices are projected to rise 1.6%, returning to an upward trend after briefly being forecast to fall. Restaurant prices are also expected to accelerate, with a projected increase of 5% in 2024, the highest forecast so far.
Despite these forecasts, food prices in 2024 are expected to rise less than the 20-year averages, but dining out will cost more than the five-year average. The increases, while significant, remain below those seen in 2023 and 2022, the latter of which saw the highest rises in over 40 years.
Overall, food price inflation continues to be a significant economic factor, even as overall inflation rates ease.
Of note: Grocery prices have only declined twice in data going back to the 1970s, highlighting the uncertainty surrounding USDA’s previous forecast for a decline in 2024.
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