Import And Export Prices Rise

Import prices, inflated by the yearlong decline in the dollar, continue to offer what may prove to be an early and, from the Federal Reserve's perspective, a welcome indication of price pressures. Import prices rose 0.4 percent in February which hits Econoday's high estimate and the gain comes despite a 0.5 percent decline in prices of petroleum imports. Excluding petroleum, import prices rose 0.5 percent for a second straight month which is very hot for this reading.

Prices of finished imports are showing increasing lift with capital goods up 0.6 percent in the month and consumer goods also showing pressure, up 0.5 percent. Industrial supplies have also been climbing including related durables which rose 0.9 percent in a reading that includes imported primary metals.

Export prices rose a monthly 0.2 percent and got a boost from agricultural prices which rose 0.6 percent. Traction for selling prices is less noticeable than on the import side, led in February by a 0.3 percent gain for consumer goods which, however, is small category for U.S. business.

February price data were uniformly soft before today's import data, which though not showing an alarming increase do nevertheless support the Fed's view that rising imported inflation should help prices move to their 2 percent inflation target over the course of the year.