Global| Dec 14 2006U.S. Import Prices Up
by:Tom Moeller
|in:Economy in Brief
Summary
Overall import prices increased 0.2% last month following two months of sharp decline and compared to Consensus expectations for no change. The increase occurred despite a 1.6% decline in the prices of petroleum imports after [...]
Overall import prices increased 0.2% last month following two months of sharp decline and compared to Consensus expectations for no change.
The increase occurred despite a 1.6% decline in the prices of petroleum imports after October's 10.1% plunge, which was deeper than initially reported. So far in December the price of Brent crude oil has risen roughly four dollars from the $59.36 per bbl. averaged in November.
Less petroleum import prices reversed the October decline with a 0.7% increase. During the last ten years there has been a 66% (negative) correlation between the nominal trade-weighted exchange value of the US dollar vs. major currencies and the y/y change in non oil import prices. The correlation is a lower 47% against a broader basket of currencies.
Prices for nonoil industrial supplies & materials reversed all of the prior month's decline with a 2.9% (1.7% y/y) increase. Prices for nondurables less petroleum jumped 6.5% (-10.9% y/y) in November following several months of decline this year. Prices for durable industrial supplies & materials (14.7% y/y) were strong early this year but m/m price gains have evaporated. These prices are unchanged since June.
Capital goods prices were unchanged for the fourth straight month (0.2% y/y) and excluding a 0.1% (-3.6% y/y) increase in computers, capital goods prices also were unchanged (2.0% y/y) in November. Prices for nonauto consumer goods additionally were unchanged (1.1% y/y).
Export prices rose 0.4% after two months of decline as nonagricultural commodities prices ticked up 0.1% (3.4% y/y) and agricultural export prices surged 4.4% (10.4% y/y).
The Adjustment of Global External Imbalances: Does Partial Exchange Rate Pass-through to Trade Prices Matter? from the Federal Reserve Board is available here.
The Internationalization of the Dollar and Trade Balance Adjustment from the Federal Reserve Bank of New York can be found here.
| Import/Export Prices (NSA) | November | October | Y/Y | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|---|
| Import - All Commodities | 0.2% | -2.3% | 1.2% | 7.5% | 5.6% | 2.9% |
| Petroleum | -1.6% | -10.1% | 1.5% | 37.6% | 30.5% | 21.0% |
| Non-petroleum | 0.7% | -0.5% | 1.3% | 2.7% | 2.6% | 1.1% |
| Export- All Commodities | 0.4% | -0.3% | 3.9% | 3.2% | 3.9% | 1.6% |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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