As fuel prices remain high and the U.S. annual inflation rate reached its highest level in decades, a billionaire CEO warned that Americans should be more concerned with rising food prices.
In an interview with Fox Business, United Refining Company and Gristedes CEO John Catsimatidis uttered similar worries as BlackRock CEO Larry Fink, who recently cautioned that the dramatic spikes in oil and mineral prices have distracted investors from the increase in food prices.
“You need optimism from the White House point of view to the American people, because everything that’s been done lately has hurt the American people and helped the rest of the world,” Catsimatidis told the network. “There is a problem in food prices that could happen as interest rates go up, as there will be shortages of certain products.”
Although the average price of gas in the United States has dropped since hitting a record high on June 14, Catsimatidis notified the worst part of inflation is yet to come.
“Food prices will peak out. We’ll reach peak prices in September, because there’s a lag between oil and food prices as they go up,” the businessman explained. “There’s always a maybe 90-day lag in food, a 30-day lag in prices at the gas station from crude oil.”
Last month, the U.S. Department of Agriculture (USDA) released its 2022 Food Price Outlook, providing Americans insight into how much food prices are expected to rise this year.
In its outlook, the agency predicted that all food prices are expected to increase between 6.5 and 7.5 percent, adding that the cost of takeout food and restaurant meals are expected to rise between 6 and 7 percent, while at-home food will jump between 7 and 8 percent.
In April, Catsimatidis, who is also the CEO of the real estate and aviation company Red Apple Group, already predicted that food prices would soar by another 10 percent within the next 30 to 45 days amid the inflationary environment.
The New York City supermarket chain owner argued that the Biden administration and the Federal Reserve can still prevent the United States from entering a recession.
“My opinion is they should delay increasing interest rates before they destroy the real estate industry and other industries in the United States with high interest rates,” said Catsimatidis.
The CEO’s comments come just weeks after annual inflation in the country climbed to 9.1 percent, reaching a new four-decade high, topping the market estimate of 8.8 percent and May’s annual rate of 8.6 percent.
While the core inflation rate, which excludes the volatile food and energy sectors, eased to 5.9 percent, that was higher than the forecast of 5.7 percent. On a monthly basis, core inflation rose at a higher-than-expected pace of 0.7 percent.
Food prices also soared by 10.4 percent, and nearly every food item, except uncooked beef steak, was more expensive last month. Pork, for example, surged by 9 percent, chicken by 18.6 percent, and ham by 9.6 percent. Eggs spiked by 33.1 percent, milk by 16.4 percent, fruits and vegetables by 8.1 percent, and coffee by 15.8 percent.
Catsimatidis noted that the Federal Reserve should avoid raising rates for another 30 to 90 days, explaining the move will stabilize food prices and prevent the rate of inflation from getting out of hand.
