McDonald’s launched its much-hyped US$5 value meal promo in the U.S. as it tries to win back cost-conscious customers and dispel all those memes about how expensive it’s gotten.
Big picture: To misquote Fall Out Boy, this ain’t a meal deal, it's an arms race. Chains are in a war to offer the best possible value to revive depressed spending. When word broke that McDonald’s was dropping a $5 deal, both Burger King and Wendy’s beat it to the punch.
- Even bargain-resistant Starbucks offered half-price fraps and BOGO deals in May after starting the year with its biggest quarterly U.S. traffic decline since 2010.
Why it matters: Discounts are another sign of slowing inflation, and while these fast food deals haven’t come to Canada (yet), other cuts have. Around a third of goods and services in StatCan’s consumer price index basket dropped year over year (YOY) this April, per Desjardins.
- That’s the highest share of declining prices since January 2021, with prices for fresh fruits, clothing, cell services, and other everyday niceties down as much as 26.6% YOY.
Bottom line: Prices aren’t returning to where they were before the great inflation surge of 2022, but we can hold out hope that the price of grabbing a quick bite has stabilized.—QH