ECB Researchers: Distinguishing Frequency and Magnitude of Price Hikes, No Sustained Broad Repricing in Food Inflation by 2026
Researchers at the European Central Bank utilized daily supermarket price data to decompose food inflation into two dimensions: the frequency of repricing and the magnitude of price changes. The data show that the energy shock triggered by the Middle East conflict in 2026 had a far weaker impact on the frequency of food price hikes than the 2022 Russia-Ukraine war. After a brief increase, the frequency of price hikes stabilized, avoiding the sustained wave of broad-based repricing seen in 2022.
After an energy shock, does inflation become widespread and persistent? For investors, CPI figures alone cannot answer this question—food inflation of 3% could stem from sharp price increases in a few products or from small price hikes across almost all products. The former is often temporary, while the latter indicates that cost-push inflation is taking root.
In a blog post published on November 2, 2026, researchers Chiara Osbat, Christian Höynck, Umberto Maglione, and Elisabeth Wieland of the European Central Bank provided micro-level evidence for this distinction using the "Daily Price Dataset" (DPD). Since 2022, the DPD has collected online supermarket prices in the euro area daily, mapping products to Harmonised Index of Consumer Prices (HICP) categories using an AI classifier. It calculates monthly repricing frequencies to filter out short-term fluctuations and temporary promotions, while allowing continuous updates to estimates within the current month.
The core analytical framework of the article decomposes pricing behavior into two margins: the extensive margin, which refers to how often firms adjust prices; and the intensive margin, which refers to the magnitude of each price adjustment. When shocks are small, firms adjust prices according to their established plans; when shocks are large enough, firms adjust prices earlier than planned—this is known as "state-dependent pricing." Once early price adjustments become widespread, the frequency of price increases rises, potentially leading to non-linear acceleration in inflation.