After months of wallet-clutching prices, the cost of a steak may finally be going down.
Expensive cuts of meat like rib-eye and New York strip – often among the most expensive single items in a grocery cart – are even seeing discounts in some stores as meat plants bolster staffing and supplies stabilize, the Wall Street Journal reports.
Beef prices in stores dropped .7% in the four weeks ending Aug. 7, according to an Information Resources Inc. report cited by WSJ. It was the second straight four-week period of decline in more than a year and a half after dropping 1% in the previous period.
Part of the drop in price appears to be due to changes in consumer behavior.
Tyson Foods said in its third quarter results released earlier this month that the average sales price for beef went down in the third quarter of 2022 “driven by reduced demand for premium cuts of beef as compared to exceptionally high demand in the third quarter of fiscal 2021.”
“Promotional prices have come back to where they were two years ago,” one shopper told the WSJ. “I always eat red meat. I’m happy.”
Prices at the wholesale level fell from June to July, the first month-to-month drop in more than two years and a sign that some of the U.S. economy’s inflationary pressures cooled last month.
An August report from the Labor Department showed that the producer price index — which measures inflation before it reaches consumers — declined 0.5% in July. It was the first monthly drop since April 2020 and was down from a sharp 1% increase from May to June.
The easing of wholesale inflation suggests that consumers could get some relief from relentless inflation in the coming months. The wholesale report follows government data Wednesday that showed that consumer inflation was unchanged from June to July — the first flat figure after 25 straight months of increases.
Yet economists caution that it’s still too early to say that inflation is headed steadily lower.
“The July deceleration … is a move in the right direction,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “But producer costs continue to rise at a rapid pace, well above target.”
Federal Reserve officials saw signs that the U.S. economy was weakening at their last meeting but still called inflation “unacceptably high’’ before raising their benchmark interest rate by a sizable three-quarters of a point in their drive to slow spiking prices.
In minutes from their July 26-27 meeting released Wednesday, the policymakers said they expected the economy to expand in the second half of 2022. But many of them suggested that growth would weaken as higher rates take hold. The officials noted that the housing market, consumer spending, business investment and factory production had decelerated after having expanded robustly in 2021.
Slower growth, they noted, could “set the stage’’ for inflation to gradually fall to the central bank’s 2% annual goal, though it remained “far above’’ that target. But the policymakers made clear that for now, they intend to continue raising rates enough to slow the economy.
The Associated Press contributed to this report.