Another sign of inflation reared its ugly head today. The cost of eating at McDonald's may soon go up, though company officials haven't said by much.
Raising prices isn't something a company announces in a press release. Instead, analysts listening in on the company's quarterly conference call say company officials disclosed that it would raise prices on some menu items in the coming months to cover rising costs.
It was news the analysts wanted to hear, since it reassures investors that the company is committed to remaining profitable, and feels confident enough in this economy to boost prices. In fact, the fast-food chain, and most of its competitors, held off on prices increases in 2010 for competitive reasons.
But consumers may take the news a bit differently, since it will be just one more thing going up in price, at a time when inflation isn't supposed to be a problem. Gasoline is already 30 cents or more a gallon higher than it was at this time last year.
The company's chief financial officer, Pete Bensen, said McDonald's has locked in as many costs as possible but faces higher food costs in the coming year, just like consumers. He said commodities costs could rise as much as 2.5 percent this year in the U.S.
Beef, in particular, has been a wild card among the food costs. For a company that made its name selling hamburgers, it's an important cost.
None of the McDonald's executives on the call mentioned which menu items might become more expensive this year and how much they would go up in price.