Americas Retail Supermarkets Food at home inflation decelerated to +1.8 in September

Equity Research 14 October 2026 | 9:41AM CDT

Americas Retail: Supermarkets: Food-at-home inflation decelerated to +1.8% in September

The Bureau of Labor Statistics (BLS) released food-at-home (FAH) CPI for September. Leah Jordan, CFA | Goldman Sachs & Co. LLC September FAH CPI data decelerated to +1.8% from +2.2% in August (vs the Kate McShane, CFA long-term average of +2.5%), while leading indicators suggest a slight reacceleration | in FAH CPI over the next six months. Goldman Sachs & Co. LLC

Eli Thompson | Food-at-home inflation decelerated Goldman Sachs & Co. LLC September FAH CPI data decelerated to +1.8% from +2.2% in August (vs the Aman Verma long-term average of +2.5%), with the greatest deceleration in protein, followed by | other foods at home, cereal/bakery, and dairy, while fruits/vegetables and Goldman Sachs India SPL

non-alcoholic beverages accelerated.

Exhibit 1: FAH CPI decelerated in September FAH CPI by category

Cereals & Bakery Products Meats, Poultry, Fish & Eggs Dairy and Related Products Fruits & Vegetables Nonalcoholic Beverages Other Food At Home CPI – FAH 8%

Jan-24 Mar-24 May-24 Jul-24 Sep-24 Nov-24 Jan-25 Mar-25 May-25 Jul-25 Sep-25 Nov-25 Jan-26 Mar-26 May-26 Jul-26 Sep-26

Source: BLS, Haver Analytics, Goldman Sachs Global Investment Research

Relative value remained in favor of Grocery over Restaurants Relative value – the gap between FAH and FAFH – tracked at -1.7% in September (vs -1.2% in August), remaining in favor of grocery as restaurant inflation outpaced grocery inflation, which could be supportive for incremental food-at-home spending by consumers. However, the latest PCE data (August) revealed that food spending shifted away from grocers (toward restaurants) by -70 bps y/y (vs the historical trend of -35 bps).

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Goldman Sachs Americas Retail: Supermarkets

Exhibit 2: Relative value remained in favor of Grocers in Exhibit 3: Restaurants gained wallet share from grocers in September August Food at home (FAH/Grocery) vs Food away from home Share of PCE – Grocery vs Restaurants (FAFH/Restaurants) CPI inflation

FAH-FAFH FAH FAFH Grocery Restaurants

Grocery More 70% August '26: 54.1% 10% Jan '20: 56.5% (-70 bps y/y)

Restaurants More Expensive x 50% 10-yr avg: -35 bps/yr

-5% Restaurant prices are 30% rising more rapidly than Grocery 20% -10%

Source: BLS, Goldman Sachs Global Investment Research Source: BEA, Goldman Sachs Global Investment Research

Leading indicators suggest a slight reacceleration in FAH CPI over the next six months The S&P GSCI Ag & Livestock Index suggests a slight reacceleration in FAH CPI over the next six months, noting the latest month revealed an acceleration. The GS Food COGS Index also suggests a similar outlook, with a greater magnitude for the potential acceleration. Overall, we expect FAH inflation trends to remain supportive for the grocery sector, noting grocery stocks typically outperform during periods of rising FAH inflation.

Exhibit 4: S&P GSCI Ag & Livestock Index suggests a slight Exhibit 5: The GS Food COGS Index suggests a slight reacceleration in FAH CPI over the next six months reacceleration in FAH CPI over the next six months

25% 15% 75% 15% GS Food COGS Index (LHS - 7 mo lag) CPI – FAH S&P GSCI Ag & Live Index (LHS - 7 mo lag) CPI - FAH (RHS) 20% 10% 50% 10% 15%

0% 0% -5% -5% -10% -25% -5% -15% Correlation/RSQ -10% 68%/47% since 1993 -20% Correlation/RSQ 70%/49% since 2003 81%/66% since 2004 -50% -10% -25% -15%

Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24 Jan-25 Jan-26 Jan-27 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13…