The Labor Department released a report on Friday showing U.S. import prices inched up by much less than expected in the month of September, although the report also showed a bigger than expected increase in U.S. export prices.<\/p>\n
The report said import prices crept up by 0.1 percent in September after climbing by an upwardly revised 0.6 percent in August.<\/p>\n
Economists had expected the pace of import price growth to match the 0.5 percent increase originally reported for the previous month.<\/p>\n
The uptick in import prices reflected a continued surge in prices for fuel imports, which spiked by 4.4 percent in September after soaring by 8.8 percent in August.<\/p>\n
Excluding fuel, import prices slipped by 0.2 percent for the second consecutive month amid lower prices for foods, feeds, and beverages; non-fuel industrial supplies and materials; capital goods; and automotive vehicles.<\/p>\n
The report said import prices in September were down by 1.7 percent compared to the same month a year ago, as prices for fuel imports plunged by 8.9 percent and prices for non-fuel imports slid by 0.8 percent.<\/p>\n
“Declining import prices for consumer goods and auto parts should minimize the risk of a resurgence in consumer inflation,” said Jeffrey Roach, Chief Economist for LPL Financial.<\/p>\n
He added, “Despite the disappointing CPI release yesterday, the Fed will likely keep rates unchanged in November as financial conditions tighten organically from the recent spike in bond yields.”<\/p>\n
Meanwhile, the Labor Department said export prices advanced by 0.7 percent in September after jumping by a downwardly revised 1.1 percent in August.<\/p>\n
Export prices were expected to climb by 0.5 percent compared to the 1.3 percent surge originally reported for the previous month.<\/p>\n
The bigger than expected increase in export prices came as prices for non-agricultural exports shot up by 1.0 percent, more than offsetting a 1.1 percent slump in prices for agricultural exports.<\/p>\n
Export prices in September were down by 4.1 percent compared to the same month a year ago, reflecting the smallest year-over-year decline since February. <\/p>\n