Grocery prices continued their gradual climb in June even as overall U.S. inflation posted its largest monthly decline in more than six years, according to new data released Tuesday by the U.S. Bureau of Labor Statistics.
The Consumer Price Index (CPI) fell 0.4% on a seasonally adjusted basis during the month, driven primarily by a sharp drop in gasoline prices. However, food prices continued to edge higher, with both food-at-home and food-away-from-home indexes rising 0.2% in June.
For grocery retailers, the report reinforces a trend seen throughout much of 2026: while grocery inflation has moderated substantially from pandemic-era peaks, price pressures remain uneven across categories.
Food-at-home prices are now up 2.7% over the past 12 months, while restaurant prices have increased an even faster 3.4%. Overall food inflation stands at 3.0% year over year.
Among major grocery departments, dairy posted one of the strongest monthly gains, climbing 1.2% in June. The meats, poultry, fish and eggs category rose 0.6%, led by another increase in egg prices, which jumped 4.3% during the month despite remaining well below year-ago levels. Cereals and bakery products increased 0.3%. Meanwhile, nonalcoholic beverages declined 1.5%, reflecting a 2.0% drop in coffee prices, while fruits and vegetables slipped 0.2%.
On an annual basis, fresh produce continues to experience some of the industry’s strongest inflation. Fruits and vegetables are up 5.3% over the past year, while meats, poultry, fish and eggs have increased 2.6%. Dairy prices remain comparatively stable, rising just 0.4% year over year.
The broader inflation picture improved considerably in June thanks to energy. The energy index fell 5.7% during the month, including a 9.7% decline in gasoline prices—the largest contributor to the overall CPI decrease. Even so, energy prices remain 15.7% higher than a year ago, underscoring the volatility that continues to affect transportation and distribution costs throughout the food supply chain.
Core inflation, which excludes food and energy, was unchanged in June and is up 2.6% over the past 12 months, suggesting that underlying price pressures continue to ease even as consumers remain sensitive to grocery bills.
For food retailers, the June report presents a mixed picture. Overall inflation is cooling faster than many economists expected, helped by lower fuel costs that could eventually reduce freight and logistics expenses. At the same time, grocery departments continue to experience selective inflation, particularly in fresh foods, leaving merchants to balance supplier cost increases with consumers’ continued focus on value.
The Bureau of Labor Statistics is scheduled to release the July Consumer Price Index on Aug. 12.