Grocery prices are rising more slowly, but groceries are not getting cheaper overall.
The U.S. food-at-home price index was unchanged in August 2026 and stood 2.2% above its August 2025 level, according to the Bureau of Labor Statistics. Some foods cost less than they did a year ago. Across the grocery basket, prices remain higher.
The U.S. food-at-home price index was unchanged in August 2026 and stood 2.2% above its August 2025 level, according to the Bureau of Labor Statistics. Some foods cost less than they did a year ago. Across the grocery basket, prices remain higher.
That distinction is the answer to a question shoppers keep asking: What is going on with groceries? An inflation rate of 2.2% means prices are increasing more slowly than they were during the worst of the food-price surge. It does not mean the earlier increases have been erased.
Think of a grocery bill that climbs from $100 to $110, then to $112. The second increase is smaller. The bill is still $12 higher than when it started.
Is Grocery Getting Cheaper Right Now?
Some items are. The average grocery basket is not.
In August, the national food-at-home index did not change from July. Fruit and vegetable prices fell 0.4% for the month, including a 6.2% decline in lettuce prices. At the same time, egg prices rose 2.9%, while dairy and nonalcoholic beverages also registered increases. Over the preceding 12 months, dairy prices were down 0.3%, but fruits and vegetables were up 3.2% and nonalcoholic beverages were up 3.7%.
A shopper who buys a lot of one category can reasonably have a different experience from a shopper who buys another. The national average describes the direction of a broad basket; it is not a receipt for any particular household.
Location matters, too. In the Baltimore area, food-at-home prices were 3.5% higher in August than a year earlier, compared with the 2.2% national increase. Cereals and bakery products in that market rose 4.9% over the year. Those figures help explain why a national report about easing grocery inflation may not sound convincing to a shopper standing at a local checkout.
Are Grocery Prices Going to Drop?
USDA’s current forecast points to another increase in average grocery prices in 2026, not a broad decline. Its August Food Price Outlook projects food-at-home prices will rise 2.5% on average for the year compared with 2025. That forecast uses data available through July; the next update may change it.
A forecast for the annual average is also different from a prediction about what will happen to prices between now and December. And a broad increase does not rule out substantial drops in individual aisles. USDA forecasts lower egg prices in 2026 than in 2025, for example, while projecting a sharp increase for beef and veal.
There is no date on which “groceries” as a whole are expected to return to an earlier price level. Prices can fall when supplies recover or demand weakens, but that usually happens unevenly across products.
Why Does the Grocery Bill Still Feel So High?
First, shoppers pay today’s prices, which include increases accumulated over several years. USDA reports that food-at-home prices rose 11.4% in 2022 and 5% in 2023, followed by smaller increases in 2024 and 2025. Slower inflation in 2026 does not reverse that buildup.
Second, a household’s total bill depends on more than the average price of food. It changes with the number of people being fed, the amount purchased, the mix of products, package sizes and which promotions are available. A lower price on eggs will be welcome, but it may be overwhelmed on a particular trip by a higher price on beef or a larger family shop.
For grocers, the lesson is straightforward: telling shoppers inflation has cooled will not settle the argument. They will judge value by the products they buy regularly and the total at the bottom of the receipt. The clearest answer is to show where prices have fallen, where they have held steady and where shoppers can build a less expensive basket.