Rising menu prices have caused traffic to dip at fast-food restaurants as economic concerns push their core customers to rein in discretionary spending.

But fast-food companies that are already grappling with margin pressures face a difficult challenge: They risk alienating the very households that have long sustained their business if they raise prices too much.

McDonald’s announced this week it was doubling down on its value proposition to rejuvenate traffic among its cost-conscious customers.

But the move from such a behemoth could, in turn, ignite a shift in the entire industry, forcing its biggest rivals to follow suit with discounts of their own, especially within the same day, according to Mark Wasilefsky, head of restaurant and franchise finance at TD Bank.

The “Golden Arche

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