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McDonald's forecasts higher food prices

A McDonald's restaurant sign is seen in Tonawanda, N.Y., April 21, 2008. (David Duprey)

April 22, 2011 12:00:00 AM PDT
McDonald's said it's expecting to pay more for beef, dairy and other items and that it would cautiously raise prices for its customers.

McDonald's stock fell 1.5 percent after it made the announcement on Thursday.

The company now expects food costs to rise between 4 and 4.5 percent in the United States and Europe this year.

Meanwhile, analysts said high gas prices could force fast-food restaurant patrons to cut back.