Restaurant CPI Drops Below 4% for First Time Since April ‘21

Restaurant CPI Drops Below 4% for First Time Since April ‘21

Another positive report with headline CPI dropping to 2.4% and Restaurant CPI dropping below 4%, pushed lower by Limited Service CPI (dropping from 4.3 to 4.1) despite remaining above 4% itself. With restaurant traffic counts continuing to look challenging, we will likely see Limited Service index dropping on value menus & discounts.

A strong jobs report last week raised the question for many as to whether the economy is too strong for more rate cuts. In fact, the Fed has never started a rate-cutting cycle with price-earnings multiples on the public markets as high as they are today. But for consumers, the double-whammy of cumulative higher prices and higher cost of debt can create a quick downward spiral when it reaches a tipping point – at least that’s what the Fed is hedging against. I’d bet on the Fed continuing the easing cycle with 2 more ¼ point reductions before the end of the year.  

On non-CPI related note – Tune in to your favorite financial news network next Monday (10/14). I’ll be Ringing the Closing Bell at the NYSE with my SignalFlare.ai teammates and our friends at Snowflake as part of our reward for winning top Tech Startup of 2024. Jayne Strickland Tammy K. Billings, MBA Nathan Lockhart Oliver Vagner

Michael Lukianoff how much a $ today use to worth 2 years ago? Did we loose something like 9% of purchase power?

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Lokender Singh

MSBI and Tableau Architect with Strong Knowledge on SSIS, Tableau , Sql Development and Power Bi

2mo

Great insights Michael Lukianoff as always . One additional perspective to consider is the potential impact of global factors like geopolitical tensions or trade issues. Global supply chains and international economic events can also play a huge role in pricing trends. For example, disruptions in energy supply or other critical resources could either slow or reverse the current trend of decreasing inflation. Moreover, it might be worth exploring whether wage growth is keeping up with inflation. If wages aren’t rising as fast as prices, consumers may continue to feel squeezed, even with lower inflation rates, which could affect their spending patterns and the broader economy. This dynamic might influence the Fed’s decisions on interest rates as well.

Good insights as always Michael Lukianoff. Can't wait to see you all ring that bell next week!

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