If your trips to the grocery store lately have you shaking your head over how much more expensive things are than they used to be, no one could blame you — food prices are up 10.9% from just a year ago, according to the Bureau of Labor Statistics most recent Consumer Price Index.
Folks looking to cut costs often head to Walmart (WMT) -) to do their shopping, as the chain is known for its low pricing. However, Walmart CEO Doug McMillon shared some unfortunate news on the topic during Goldman Sachs’ Global Retailing Conference on Sept. 12.
According to McMillon, the grocery prices of two years ago are not coming back.
“Inflation and higher prices are kind of with us. We’ll see disinflation, but not all the way back to deflation ... certainly not in the short term,” he said.
McMillon said that despite this, consumer spending has not taken the dip he thought could be coming.
More retail stories:
- ‘Too pretty’ Home Depot worker faces backlash after viral mirror post
- A classic kitchenware brand files for Chapter 11 bankruptcy
- Who’s running The Gap? With no CEO, retailer hurtles towards crisis
“In the U.S. things are better than I would have expected them to be when we started the year,” he said. “I was concerned about the amount of inflation in categories like dry grocery, consumables [and] how that would impact discretionary purchases."
While paying more for groceries is a new reality most consumers won't feel too hot about, there is one silver lining for Walmart shoppers.
"Walmart’s prices will likely be slightly lower in 2024 than this year but higher than two years ago," McMillon said.
Get exclusive access to portfolio managers and their proven investing strategies with Real Money Pro. Get started now.