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CHICAGO, August 12, 2025 —The gap between food-away-from-home and grocery prices widened during July, according to newly released government figures, giving restaurants and other foodservice outlets more reason to stress value.
The overall Consumer Price Index (CPI) ticked downward to 0.2% from June’s 0.3%, the U.S. Bureau of Labor Statistics (BLS) reported.
The figures indicate that consumers’ buying power improved slightly from the prior month, but the cost differential between cooking at home and buying meals from restaurants was more sharply contrasted.
Meals prepared outside the home rose in price during the month by 0.3%, according to BLS, in contrast to the 0.1% decline clocked for groceries.
July inflation pushed the prices of food prepared outside the home 3.9% above the levels of a year ago on average, compared with a 2.2% increase for meal ingredients purchased from a supermarket.
Overall food prices were running about 2.7% above where they were a year ago, according to BLS. The figures indicate menu prices were likely driven up faster because of the food-away-from-home channel's higher labor expenses.
Some restaurant chains have cited menu-price inflation as the reason for their soft or declining traffic.
Many have responded by adding lower-priced items, as McDonald’s did in returning its $2.99 Snack Wraps to the burger giant’s menu. Reports have come to light of franchisees being surprised by the strong demand and running out of some ingredients.
The CPI figures were released amid signs of further financial strain on some formerly high-flying restaurant chains. The Sweetgreen fast-casual chain, for instance, revealed that it had cut corporate staff by 10%. Former Panera Bread franchisee EYM filed for Ch. 11 bankruptcy protection, while the Jack in the Box burger chain posted a same-store sales decline of 7.1% for the third quarter ended July 6.
As Managing Editor for IFMA The Food Away from Home Association, Romeo is responsible for generating the group's news and feature content. He brings more than 40 years of experience in covering restaurants to the position.