Import And Export Prices Rise

Import prices, up 0.3 percent in April, got a boost from a rise in oil but were otherwise flat, at only a 0.1 percent increase excluding petroleum. Prices of finished imports show almost no pressure at all, hovering near zero on a monthly basis and barely over zero on a yearly basis. Import prices of industrial supplies did rise 1.0 percent in the month reflecting the rise in oil and also perhaps tariffs on steel and aluminum as durable supplies rose 0.4 percent with iron and steel mill products advancing a monthly 4.0 percent.

By country, import prices with Canada are going up the most, 0.6 percent higher in April for a year-on-year 6.2 percent. Import prices from Europe also rose 0.6 percent in the month with this year-on-year gain at 3.7 percent. These are offset, however, by very weak prices from China, down 0.1 percent in the month, and Japan, up only 0.1 percent, with both of these yearly rates at a very low plus 0.2 percent.

Export prices do show pressure, up 0.6 percent in the month despite a 1.2 percent decline in agricultural prices. Year-on-year agricultural prices are up only 1.4 percent and are holding back overall export prices which are up 3.8 percent. One positive sign of price traction is exports of capital goods, which is the nation's key strength and where prices rose 0.4 percent in the month for a year-on-year rate of 2.0 percent which looks subdued but is far and away the highest for any finished goods in this report.

Last year's decline in the dollar gave only a limited lift to import prices, likely reflecting discounting among foreign sellers protecting their U.S. market share. And with the dollar basically flat so far this year, import prices are not likely to be a source of price pressures this year either. Like all the inflation data for April, beginning with last week's average hour earnings and including yesterday's consumer price report, today's import & export data won't be raising any alarms at the Federal Reserve of overshooting.