Table for two… by the frozen section. With prices rising faster at restaurants than at grocery stores since early spring (7.1% vs. 3.6% YoY in July), consumers are eating out less. Grocers like Kroger, Giant Eagle, and Costco are seizing the opportunity to take a bite out of restaurants' lunch by ramping up their meal offerings (picture: ready-to-eat salads and wraps). 40% of diners say not wanting to cook is the reason they choose restaurants over grocery stores, and grocers are taking note. 

• Deli 2.0: Kroger, the US's largest grocery operator, has expanded its prepared-meal section, offering entrées bundled with sides and drinks. Giant Eagle said it'll triple its # of prepared meals this fall. Walmart has taken things further with in-store ghost kitchens.

• Pushing the cart: Prepared-food sales grew 12% last year to over $23B, led by lunch favs like soup and chili, as workers RTO'd in droves.

Convenience vs. experience… Faced with competition from grocers, restaurants are launching meals that would be a pain to re-create at home. Taco Bell made its Grilled Cheese Burrito (cheese baked on top) permanent, and KFC introduced hand-breaded nuggets. Chipotle is testing grills that it says will make a sear that can't be easily done at home. McDonald's and Burger King have invested in making restaurant interiors more appealing and speeding up orders. Still, it may prove difficult to beat a premade meal placed right by pantry staples.

You can't trademark convenience…The fast-food industry has succeeded thanks to what it offers: cooked food fast. But there's nothing to stop grocers from encroaching on the combo meal's turf. Restos padded their profits for a long time as customers kept splurging on dining, but they could take a hit as convenient alternatives pop up at the checkout aisle.

Recovery still loading… Many were expecting a huge rebound in China after the world's second-largest economy unwound its zero-Covid policy this year. Following years of lockdowns, Chinese consumers were expected to come roaring back with open wallets. That hasn't been the case: China's reopening started off as meh and has only gotten worse. 

• Growth = slow. China's second-quarter GDP growth was disappointing, decelerating from an underwhelming pace in Q1. 

• Unemployment = high. Youth unemployment in China hit a record high in June, with 21% of 16- to 24-year-olds in cities without work. 

• Exports = low. Last month, China's global exports sank at their steepest pace since early 2020 as Western consumers pulled back on Made-in-China goods.

The stimulus isn't stimulating… Remember when the US tried to save the Covid-plunged economy with trillions in stimulus and low interest rates? The effort worked almost too well, supercharging consumer demand along with inflation. China's also trying to revive spending through stimulus, but strangely, it recently tipped into deflation (falling prices). If consumers start to expect falling prices, it could weigh on demand even further. The deflation is a red flag not just for China but for the global economy.

China's recovery is bigger than China… US multinationals were hoping that China's reopening would give them a boost as Americans started pulling back at home. But this year lots of companies have felt the effects of China's slump: most recently, tractor titan Caterpillar and chemical giants DuPont and Dow reported hits to their China earnings. Yet consumer-focused companies like Apple, Starbucks, and Marriott saw significant growth in the country last quarter.