U.S. Import & Export Prices Continue to Strengthen in July

• Oil prices improve again.

• Nonoil prices increase steadily.

Import prices increased 0.7% (-3.3% y/y) during July following an unrevised 1.4% June gain. A 0.5% rise had been expected in the Action Economics Forecast Survey. During the last three months, import prices rose 11.6% (AR), the strongest rate of growth since may 2011. These figures are not seasonally adjusted and do not include import duties.

A 7.8% jump in petroleum & petroleum product prices led the strength last month in prices. It followed two straight months of double-digit increase. Nonpetroleum import prices improved 0.2% (0.3% y/y) following a 0.3% gain in June. Prices have risen 2.5% (AR) during the last three months. It was the strongest growth in just over two years and improved from price deflation as recently as April. Capital goods prices increased 0.3% both m/m and y/y. Prices have been rising since December. Capital goods prices excluding computers strengthened 0.3% (0.7% y/y) while prices for computers & peripherals held steady (-0.6% y/y). Nonauto consumer goods improved 0.2% (-0.2% y/y) for a second straight month. Prices of industrial materials excluding petroleum rose 0.9% (0.7% y/y) following a 1.4% June gain. Working 1.2% lower (-1.3% y/y) were prices of foods, feeds & beverages. Auto, parts & engine prices eased 0.2% (+0.7% y/y), off for a second month in the last three.

Export prices rose 0.8% (-4.4% y/y) during July following a 1.2% June increase, revised from 1.4%. A 0.4% gain had been expected.

The rise reflected a 1.5% gain (-3.3% y/y) in agricultural product prices, the same large increase as in June. Prices for foods, feeds & beverages strengthened 1.5% (-3.2% y/y) after rising 1.1%. Nonagricultural product prices rose 0.7% (-4.6% y/y), strong for the second straight month as well. Industrial materials prices jumped 2.0% (-12.7% y/y) as petroleum product costs increased 5.4% (-36.1% y/y). Capital goods prices improved 0.2% (0.6% y/y) but computer, peripheral & semiconductor prices held steady (-0.6% y/y) after falling for two months. Excluding these products, the cost of capital goods rose 0.2% (0.9% y/y) after falling for three straight months. Auto & auto product export prices fell 0.3% (-0.7% y/y), off for the fourth straight month, while nonauto consumer goods prices increased 0.5% (-1.1% y/y) after four straight monthly decline.

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.