Household budgets are taking a hit as restaurant prices surge, outstripping inflation rates.
According to the Bureau of Labor Statistics (BLS), menu prices jumped by 5.4 percent in October compared to the previous year.
Fast food and limited-service restaurants saw an even sharper increase of 6.2 percent.
In contrast, the cost of groceries only rose by 2.1 percent annually, with the overall inflation rate at 3.2 percent.
This shift marks a departure from the past two years when grocery prices were rising faster than dining out.
The price hikes come on the heels of several fast-food chains raising their prices, a move seemingly unaffected by consumer behavior.
McDonald’s, for instance, reported a revenue of $6.69 billion in the third quarter of 2023, attributing this to “strategic menu price increases.”
The iconic Big Mac’s price has surged by 125% since 1996, now reaching $3.91, as reported by CashNetUSA.
Chipotle also raised its prices by 13 percent in the last year and warned of further increases in California due to a new law mandating a $20 minimum wage for fast-food workers.
While the broader inflation rate hovered around 3.7 percent in August and September, following a brief dip to 3 percent in June, recent Consumer Price Index figures suggest some stabilization, with prices holding steady between September and October.
This may be seen as a modest respite after a 40-year high in annual inflation at 9.1 percent in June 2022.
Despite this, certain products still face persistent price increases.
Beef steaks, for example, shot up by 10.6 percent in the year leading to October, driven in part by drought conditions forcing cattle farmers to sell rapidly.
Uncooked beef roasts and ground beef prices also surged by 9.7 percent and 7.9 percent, respectively.
In contrast, some items have become more affordable. Eggs, once emblematic of inflation, dropped by a substantial 22.2 percent in the past year.
Lettuce, apples, and potatoes also saw their prices decline by 4.5 percent, 3.9 percent, and 3.3 percent, respectively.
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