Deflation: Walmart CEO Doug McMillon indicated on Thursday that deflation could be on the way as general merchandise and major supermarket staples like eggs, chicken, and seafood become more affordable.
- IMPORTANT NOTES
- Deflation may be on the way, according to Walmart CEO Doug McMillon.
- Prices have dropped, particularly on general merchandise and several major supermarket items, he claims.
- However, the discounter maintained a cautious tone, stating that clients are still watching their spending.
This Christmas season, shoppers may receive an early present: lower costs in numerous gift-giving areas. He said that the store expects some of the higher-priced items, such as pantry essentials, to “start to deflate in the coming weeks and months.”
“In the United States, we may be managing through a period of deflation in the months ahead,” he said during the company’s results call on Thursday. “And while that would put more unit pressure on us, we welcome it because it’s better for our customers.”
Also Read: Target World: Target Will Release Earnings Before The Market Opens, Here’s What To Expect
Consumers have been dealing with inflation for more than a year, which peaked at four-decade highs and drove up the cost of practically everything, including groceries, rent, and utilities. McMillon’s remarks, however, matched what the government and other retailers indicated earlier this week, providing some solace to inflation-weary consumers.
According to the Labor Department’s latest consumer price index report released on Tuesday, inflation was unchanged month over month. Core CPI, a statistic that excludes volatile food and energy categories, fell to a two-year low. On a Tuesday results call, Home Depot CFO Richard McPhail stated that “the worst of the inflationary environment is behind us.”
Even Thanksgiving will be less expensive for Americans than it was last year. According to the American Farm Bureau Federation, the average cost of a supper for ten people will be $61.17, a 4.5% decrease from last year’s record of $64.05.
Stubborn inflation has been one of the most difficult difficulties for retailers, especially the world’s largest retailer, Walmart. It faced the effects of this again in the fiscal third quarter, despite exceeding Wall Street’s sales and profitability estimates. According to Chief Financial Officer John David Rainey, buyers have waited for things to go on sale before purchasing them, such as waiting for a Black Friday event.
However, it will be some years before inflation entirely subsides. According to the most recent CPI figures, Americans are still paying more on the same things in most categories. Food at home, energy, and haircuts are all more expensive than they were a year ago.
Groceries at Walmart are up by a mid-single-digit percentage compared to last year, but still up by a high-teens percentage compared to two years ago, according to Rainey. According to McMillon of Walmart, some intractable food prices remain a source of concern.
“The pockets of disinflation we are seeing are helping, but we like to see more, faster,” he went on to say.
Frequently asked questions
Will inflation go down in 2023?
With the primary reasons of high inflation now in reverse, the economy is poised to experience a significant deflationary impulse. After peaking at 6.2% in 2022, inflation is expected to decline to 3.7% in 2023. We predict inflation to average 1.8% from 2024 to 2027, well below the Fed’s 2.0% objective.
Is India going through deflation?
The Wholesale Price Index (WPI) for September 2023 in India has fallen. The preliminary figures show a 0.26% contraction compared to September 2022, a minor improvement from the 0.52% deflation recorded in August 2023.
How bad will inflation be in 2025?
Projected annual inflation rate in the United States from 2025 to 2028
| Characteristic | Inflation rate |
|---|---|
| 2028* | 2.1% |
| 2027* | 2% |
| 2026* | 2% |
| 2025* | 2.1% |
Will inflation continue in 2024?
Our economists expect inflation to remain low in 2024, with sequential core inflation falling from 3% presently to an average 2-2.5% range across the G10 (excluding Japan).
Click here, to check out the latest post on Instagram.
Also Read: Stock Market Today: Global Shares Benefit From A Positive US Inflation Report
image source: google
