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Economy in Brief

U.S. Import Prices Unexpectedly Recover
by Tom Moeller   August 16, 2011

Overall U.S. import prices nudged up 0.3% last month following a little-revised 0.6% June decline. Consensus expectations had been for a 0.1% slip. Year-to-year, the lower value of the U.S. dollar as well higher oil prices have raised imported price inflation. The 5.5% gain versus last July was the strongest since 2008.

Petroleum prices rose 0.6% m/m and recovered some of the June decline. Brent crude oil were an average $116.78 per barrel (+55.0% y/y) versus the high of $122.68 during April. Nonoil import prices rose 0.2% and by 5.5% y/y. (The y/y change in non-oil import prices during the last ten years has had an 81% inverse correlation with the nominal trade-weighted exchange value of the US dollar vs. major currencies.)

Imported food & beverage prices rose 0.5% (+17.8% y/y) following two months of decline. Also, prices for nonoil industrial supplies rose 0.2% (+14.9% y/y). Prices for non-auto consumer goods rose 0.4% (1.9% y/y) while apparel prices jumped another 0.9% (8.4% y/y). Also firming were furniture prices, up 0.4% (5.2% y/y) but home entertainment equipment prices fell 0.5% (-8.9% y/y). Imported auto prices slipped 0.3% (+3.9% y/y) while imported capital goods prices were unchanged (1.4% y/y). Computer & peripherals prices fell moderately during July (-4.5% y/y). Excluding computers, capital goods prices rose 0.4% and by a stronger 4.0% y/y.

U.S. export prices fell 0.4%. Agricultural prices fell 4.3% but were up by one-quarter versus last year, led by a one-half increase in the price of wheat. That gain was accompanied by a 0.2% increase in non-agricultural goods (8.3% y/y). Prices of industrial supplies slipped 0.7% but remained up 19.8% y/y. Capital goods price gains have improved to moderately. To the upside, nonauto consumer goods prices have risen 5.7% y/y. That compares to a 0.3% gain during all of 2009.

The import and export price series can be found in Haver's USECON database. Detailed figures are available in the USINT database. The expectations figure is in the AS1REPNA database.

Import/Export Prices (NSA, %) Jul Jun May Jul Y/Y 2010 2009 2008
Imports - All Commodities 0.3 -0.6 0.2 14.0 6.9 -11.5 11.5
  Petroleum 0.6 -2.2 -0.7 48.9 28.4 -35.9 37.7
  Nonpetroleum 0.2 -0.1 0.5 5.5 2.8 -4.1 5.3
Exports - All Commodities -0.4 0.1 0.4 9.8 4.9 -4.6 6.0
  Agricultural -4.3 0.7 -1.1 25.9 7.9 -12.8 21.6
  Nonagricultural 0.2 0.1 0.6 8.3 4.6 -3.7 4.5
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