What We Need to Know about (Bacon) Inflation

In April 2020, per pound, bacon was $5.35; last month, we paid close to $6.64.

Average people call higher food prices inflation.

It’s not.

Food Prices

This St. Louis Fed graph illustrates the ascent of bacon prices:

Similarly, we are paying more for our steak (purple), coffee (green) and potato chips (dark blue). Since the pandemic, food prices have popped a whopping 19.4%:

Our Bottom Line: Inflation

While inflation really means rising prices, more recently, to most people, it means high prices.

Consequently, accurately measuring inflation, we should cite the rate that prices have changed. Then, we have a plunging graph. Having hit a 11.4% peak for food-at-home in 2022, the inflation rate for food is down. More precisely, the USDA told us that between March and April 2024, prices for nine food-at-home categories were up, down for five categories, and stable for one category. In addition, comparing April 2023 to April 2024, we would see that eggs, fish, dairy, and seafood were cheaper. Their price declines helped to pull the food inflation rate down:

Below, you can see that it all depends on your lens. Many people focus on the food prices red line when asked if inflation has subsided. Instead though, the blue line illustrates how we are conquering the threat of inflation. It brings us back to an attainable (and traditional) target inflation rate of 2%:

So, where are we? Normal people and economists perceive inflation differently.

My sources and more: As always, the Axios newsletter from Felix Salmon is an ideal springboard for more contemplation. From there, we observed the changing price of bacon here.  Correspondingly, seeing the inflation rate for food-at-home, the USDA lets us compare inflation to price rises. And finally, having looked at bacon, we concentrated on eggs here.