Costco Wholesale Business is a global corporation based in the United States that manages a chain of membership-only big-box retail locations. Since its establishment in 1976, it has grown into a multi-billion dollar establishment.
The Consumer Price Index data for August 2022 was released in September. The 8.3% inflation rate in the United States is the lowest since April 2022. It also exceeded predictions, leading some to worry about the Fed’s interest rate rise.
Markets were braced for a 0.75% rate hike by the Fed during the FOMC meeting. However, because the CPI index is greater than projected, the anticipation of a 100 basis point interest rate increase increased last week.
To combat soaring inflation, the Fed announced a 75 bps interest rate hike during the FOMC meeting. But even amidst all of this, Costco has no plans to hike its $1.50 hot dog and soda combo price.
Costco to keep its price sturdy
Costco’s CFO states that the company has no intention of hiking the price of its $1.50 hot dog-and-soda combo. The company’s sturdy decision comes amidst a situation where the economy is going through soaring inflation.
CFO Richard Galanti spoke about the decision during the firm’s earnings call on Thursday.
“Lightning just struck me.” “Those things help us be more aggressive in other areas, or as you mentioned, hold the price on the hot dog and the soda a little longer – forever,” Galanti stated.
Over the past year, Costco and other retailers have raised prices, passing on to customers the increased cost of products and commodities. Although it has marginally decreased recently, August’s inflation rate of 8.3% was higher than forecast. The firm is also not planning to even hike its membership fees.
Even with soaring inflation, Costco’s quarterly revenue was more than expectations.