Grocery pricing continued a steady decline in February amid an ongoing relaxation in the Consumer Price Index (CPI).
The February CPI for All Urban Consumers gained 6.0% (unadjusted), down from a 12-month increase of 6.4% in January, the U.S. Bureau of Labor Statistics (BLS) reported Tuesday. That marked the eighth consecutive month of year-over-year decreases in the CPI and, according to BLS, the lowest yearly uptick since September 2021.
Going back a year, the CPI saw annual growth in 2022 of 6.5% for December, 7.1% for November, 7.7% for October, 8.2% for September, 8.3% for August, 8.5% for July, 9.1% for June, 8.6% for May, 8.3% for April, 8.5% for March and 7.9% for February 2022.
On a month-to-month basis, the February CPI was up 0.4% (seasonally adjusted), down from 0.5% in January, which had represented an increase from 0.1% in December. Sequential growth in the CPI during the past year, though up and down, has mostly remained below 1% since the summer, coming in at 0.2% in November, 0.5% in October and 0.4% in September, 0.2% in August, flat in July, 1.3% in June, 1% in May, 0.3% in April, 1.2% in March and 0.8% in February 2022.
The February CPI report should give a shot of confidence into the arms of consumers and businesses amid recent news of bank failures, providing a sign that at least costs may be on their way down.
That appears to be the case with food. Annually, the food CPI—including food-at-home and food-away-from-home—had 9.5% growth in February, down from 10.1% in January. The decrease marked the first time that year-over-year food inflation was below double digits since April 2022 and continued a steady decline from 10.4% in December, 10.6% in November, 10.9% in October, 11.2% in September and 11.4% in August. Those numbers followed a steady rise to 10.9% in July, 10.4% in June, 10.1% in May, 9.4% in April, 8.8% in March and 7.9% in February 2022.
The food index rose 0.4% on a monthly basis for February, lower than the 0.5% uptick in January and following a decline to 0.3% sequential growth in December from 0.5% in November, according to BLS. The food CPI remains down from monthly gains of 0.6% in October, 0.8% in September and August, 1.1% in July, 1% in June, 1.2% in May, 0.9% in April, 1% in March and 1% in February 2022.
For February, the food-at-home CPI was up 10.2% year over year, down from 11.3% in January. Though grocery inflation is still elevated, pricing continues to ease up, with the food-at-home index recording annual upticks of 11.8% in December, 12% in November, 12.4% in October, 13% in September and 13.5% in August. The end-of-summer months represented the end of increasing 12-month growth since the start of 2022, as the food-at-home CPI rose 13.1% for July, 12.2% for June, 11.9% for May, 10.8% for April, 10% for March and 8.6% for February.
Sequentially, the food-at-home index edged up 0.3% for February, the smallest monthly increase—along with the 0.4% uptick for January—since December 2021 (0.4%). Monthly gains in the food-at-home index have remained below 1% since a 0.8% uptick in August, followed by 0.7% in September, 0.5% uptick in October, 0.6% in November and 0.5% in December. That compared with hikes of 1.3% in July, 1% in June, 1.4% in May, 0.9% in April, 1.5% in March and 1.4% in February 2022.
Five of the six major grocery store food group indices for food-at-home were up on a monthly basis (adjusted) in February. Increases were led by nonalcoholic beverages (+1%) and followed by other food-at-home (+0.3), cereals and bakery products (+0.3%), fruit and vegetables (+0.2%), and dairy and related products (+0.1%).
The meat, poultry, fish and eggs index dipped 0.1% month over month for February, the first decrease since December 2021, BLS noted. And in welcome news for consumers, the index for eggs dropped 6.7% in February after price jumps in recent months.
All six food-at-home group indices remained elevated in February on an annual basis (unadjusted), with four up by double digits. Cereals and bakery again saw the highest 12-month price increase (+14.6%), followed by other food-at-home (+12.4%), dairy and related products (+12.3%), nonalcoholic beverages (+12.3%) and then upticks of 6.8% for meat, poultry, fish and eggs and 5.3% for fruit and vegetables. Egg prices were up 55.4% year over year for February, still sky-high but down from 70.1% for January.
On the other side, the February food-away-from-home index was up 8.4% on a yearly basis, a gain from 8.2% in January, 8.3% in December and 8.5% in November. Food-away-from-home also rose 0.6% month to month in February—the same as in January—versus 0.4% in December and 0.5% in November.
Excluding food and energy, the February CPI climbed 5.5% from a year earlier and by 0.5% from a month earlier, about the same as increases of 5.6% year over year and 0.4% month to month in January, BLS reported.
Both gasoline and fuel oil costs have moderated. For February, gas prices were up 1% month over month (adjusted) but down 2% (unadjusted) year over year, versus gains of 2.4% monthly basis and 1.5% annually for January. Meanwhile, fuel oil pricing dropped 7.9% in February from the previous month yet was up 9.2% from a year ago.
Consumer market data specialist Numerator estimated February food-at-home prices as up by 9.4% year over year (lower than the CPI measure) and by 0.5% month over month (higher than the CPI measure). For the four weeks through Feb. 19, Numerator’s latest Inflation Price Pulse tracker pegged grocery pricing as up 9.7% from a year ago, the same as for the household products category but higher than the 7.6% uptick for health and beauty aids.
Among retail channels over the four weeks through Feb. 19, grocery prices were highest for dollar stores (+16.8% year over year), followed by mass merchants (+12.2%), grocery stores (+9.7%), online (+7.3%) and warehouse clubs (+6.8%), Numerator’s inflation tracker showed.