Now that the oil prices have gone down when will the grocery prices go down?

I'm just curious about that.Now that the oil prices have gone down when will the grocery prices go down?
There is good news and bad news for future grocery prices:





The good news is that there is some home that prices will come down if there is a price war, and with lower input costs, there is no longer the excuse they previously had to raise prices so dramatically. Therefore, we can expect grocery prices over the rest of the Holiday to be outpaced by price increases in other goods.





The bad news is that grocery prices may not head back down to their earlier prices at all.





The reason for this is that prices for groceries are ';sticky prices.';





Unlike stock prices which move up and down quickly based on the supply and demand of stock market participants, grocery prices are set by companies who are trying to maintain profitability during tough economic times when shoppers are less willing to shop, even cutting back on how much food they hold in their refrigerator at a time.





They don't raise prices right away either, they wait for a reason to make any change such as the dramatic rise in input costs faced earlier this year. Then they consider if they must change prices to protect their bottom line.





However, when deciding if they should drop prices, the consideration for their bottom line makes them drag their feet even longer if possible, since they know that dropping their prices may lead to a price war.





Also, the transaction costs of changing all their prices, advertisements, labels, etc makes them hesitant to change, so they try to make a one-shot change that they believe they will be able to hold for a reasonable period of time. They rarely do daily changes.





So with long-term prices still expected to fluctuate up and down for many reasons besides fuel, many companies will just wait it out if they can.





You can hope for a price war, but those are rare.





Let's hope for one, we could sure use it.





As a side note, gas prices tend to trail oil prices by about a month, and gas prices are set by many different individual gas stations in a much more competitive environment... while market groceries are set by a few big companies in a less competitive environment.Now that the oil prices have gone down when will the grocery prices go down?
I hope soon. I was going to buy a small cake and it costs $26! I put it down and screamed in the store ';HOLY CRAP'; Then everybody was looking at me.