Grocery prices rise at the fastest pace since 2022 as Trump tariffs bite

Data: Bureau of Labor Statistics; Chart: Axios VisualsPresident Trump spent his 2024 campaign promising Americans he'd lower grocery prices.Virtually all major grocery categories are now more expensive than they were a year ago, some substantially so.Why it matters: Trump's economic polling numbers are about the worst they've ever been, and almost on par with the worst of the Biden presidency.Whatever growth the administration says is coming from its trade and industrial policy, nothing is more vivid to households than what they pay to feed themselves.Driving the news: The food-at-home component of the Consumer Price Index rose 0.6% in August from July, the Bureau of Labor Statistics said on Thursday.This was the biggest month-over-month increase since August 2022, the tail end of a year of huge monthly increases in grocery prices. The big picture: Trump has framed his tariffs on China, steel and other imports as a way to protect American workers and bring down costs.But those same trade barriers can raise input costs — from fertilizer to machinery to transportation — that ripple through food prices.Grocery chains, already facing higher wholesale costs, say they are trying to avoid passing the increases along to shoppers where possible.State of play: Retailers including Walmart have said they have had to increase some prices.Kroger CFO David Kennerley said Thursday that the chain's approach is to "raise prices as a last resort, to ensure that we keep prices as low as possible."Interim CEO Ron Sargent said they've lowered prices on more than 3,500 products across stores, which is "improving our price spreads against our major competitors."By the numbers: Broad price increases last month hit key items that have been subject to Trump's tariffs, including groceries.Coffee is up 20.9% year-over-year, with a 3.1% monthly increase, per CPI.Uncooked beef steaks are up 16.6% year-over-year with a 3.3% monthly bump.While fruits and vegetable overall were up 2.3% year over year, apples rose 9.6% and bananas, 6.6%.What they're saying: Bankrate analyst Stephen Kates tells Axios that each month's increase may add only a few cents to individual items, or a few dollars to a shopping trip, but over time it adds up."Grocery retailers, already operating on slim margins, have little room to cut prices on their own," Kates says.For the record: A White House official notes that the annualized pace of grocery inflation since Trump took office is 1.8%, a low figure that is less than the late Biden era. The August data, on its own, does not make a trend, the official adds. "As the Trump economic agenda continues to take effect, the trillions of dollars in private sector and foreign investments, historic tax cuts, massive deregulation, and energy dominance that the President is spearheading will fuel an economic boom," White House press secretary Karoline Leavitt said in a statement. Reality check: It's not just tariffs pushing up grocery costs — and of the many factors at play, it's not clear how long some will last."Bad weather, shortages of farm workers and tariffs are potential culprits behind high grocery prices," wrote Bill Adams, chief economist at Comerica Bank. "But grocery prices can be volatile, and it will take time to know how persistent August's spike will be,"The White House said last week that it would consider lowering tariffs on hundreds of products across sectors, including food, if specific deals can be struck with trading partners.. What we're watching: The prospect of lower tariffs on some grocery staples in particular could ease pressure on consumers, but any impact would be months away.Without relief, according to Phil Kafarakis, CEO of IFMA, The Food Away From Home Association, consumers will be paying more for holiday meals and facing shortages on a variety of items."Consumers will be faced with purchase decisions that they have not had to make in years," Kafarakis tells Axios.

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