Inflation May Be Down, but Prices Are Still Up

It came as relief to many Americans when inflation finally started to cool. But a slower pace of price increases still means just that… prices continue to go up.

Last year, America’s largest retailer by revenue, Walmart (WMT), told customers prices on certain goods were falling and that consumers would feel the benefits if the trend continued. But that optimism was short-lived. Last week, Walmart announced that price increases on many of its grocery items and household goods are here to stay.

Retailers Resist Reductions

Even though inflation has come down, prices are still increasing at a rate of more than 3%, in January. The Federal Reserve targets an inflation rate of 2%.

Home Depot (HD), similar to Walmart, said prices had “settled”, suggesting they won’t be coming down anytime soon. Meanwhile, Coca-Cola (KO) shared that its prices are still rising and customers should expect more increases, albeit modest ones.

But even as wholesale prices deflate, companies might be hesitant to pass those savings on to consumers, as lower prices mean businesses must increase volume to keep overall sales steady.

These corporate decisions notwithstanding, the bottom line for consumers is clear: Prices are high, and they keep going up. Nearly 3 in 4 Americans say they are very concerned about the price of food and other essential goods, per Pew Research Center .

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