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Food Stamp Cuts Force Retail Changes

Beginning Friday grocers, discount, and convenience stores face a tougher sell to some low-income customers. Food stamp benefits are being cut for nearly two million Ohioans. Central Ohio economist Jim Newton, says he expects grocers to respond with some price cuts. "They are certainly going to be highly selective in where they cut their prices," says Newton. "Try to find those things where volume is going to kind of offset price cuts." The 2009 economic stimulus bill temporarily boosted the food stamp program. The expiration of the stimulus means a family of four will see 36 dollar less per month in food stamps. Newton predicts consumer spending reductions will likely spread beyond the grocery store. "If people are going to have to switch some of their disposable income into buying food now that's not being supported by food stamps, then other types of retailers are going to be impacted too. And, it comes at a particularly bad time of year with Christmas just around the corner," says Newton. Newton adds the only good thing is that food inflation remains relatively modest.