• June increases were large but in line with expectations.

• Yearly rates declined slightly but remain elevated.

• Higher fuel prices a major factor behind rise in import prices.

Import and export prices continued to soar in June. Export prices rose 1.2% m/m (16.8% y/y) in June after an unrevised 2.2% m/m jump in May. Import prices rose 1.0% m/m (11.2% y/y) in June versus an upwardly revised 1.4% m/m gain in May (initially 1.1%). The 16.8% y/y gain in export prices was the second largest in the series history, dating back to 1983, exceeded only by the 17.5% y/y surge in May. The Action Economics Forecast survey had looked for import prices to rise 1.2% m/m and for export prices to increase 1.3% m/m.

Prices for imported fuel advanced 4.7% m/m (85.1% y/y) in June following a 5.5% m/m increase the previous month. Higher prices for petroleum and natural gas were key contributors to both advances. The price index for imported petroleum rose 4.6% m/m in June after increasing 5.4% m/m in May. Natural gas prices advanced 8.1% m/m in June following a 7.9% m/m rise the previous month. Nonfuel import prices rose 0.7% m/m (6.5% y/y) in June, after advances of 0.9% in May, 0.8% in April, and 0.9% in March. In June, higher prices for nonfuel industrial supplies and materials (1.9% m/m); foods, feeds, and beverages (1.9% m/m); consumer goods ex autos (0.4% m/m); and capital goods (0.2% m/m) all contributed to the increase in nonfuel import prices.

The 1.2% m/m rise in export prices in June was the seventh consecutive month in which export prices have increased more than 1.0%. Higher prices for nonagricultural and agricultural exports both contributed to the overall advance in June. Prices for agricultural exports advanced 1.5% m/m (33.5% y/y) in June following a 6.1% jump in the previous month. In June, a 10.6% m/m increase in meat prices more than offset lower prices for corn, wheat, and soybeans. The price index for nonagricultural exports advanced 1.1% m/m (15.0% y/y) in June, after rising 1.8% in May and 1.2% in April. In June, higher prices for nonagricultural industrial supplies and materials (2.1% m/m, driven primarily by higher fuel prices); capital goods (0.4% m/m); and consumer goods ex autos (1.0% m/m) led the advance in nonagricultural export prices.

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 from the Action Economics Forecast Survey is in the AS1REPNA database.