The Federal Reserve is expected to continue pushing up interest rates as it tries to bring down persistently high inflation with the general idea of slowing consumer demand and easing inflationary pressure. The reduced demand usually translates to job or income loss, which becomes the primary pain during a recession. Inflation is still running around its highest level in more than 40 years.
Food stocks, which fall under the consumer staples sector, tend to perform relatively well during inflation due to the inelastic demand for these products. Moreover, the higher costs from inflation can easily be passed on to the consumer. The food index rose 0.8% for September and is up 11.2% from its year-ago value.
