WASHINGTON — The first of the U.S. October price reports was better than expected and suggests that imports will help contain domestic inflation ahead.
October import prices posted -0.7% in their biggest drop since April, and ex-fuel import prices were flat.
Export prices fell 0.5%, and ex-agricultural exports were -0.4%.
Over the year, import prices are down 2.0%. That is an acceleration from the -1.0% last month in this measure and is the fastest pace of decline since April. Import prices are showing that all areas dipped over the year, that is, that there are no points of price pressure.
Away from oil, import prices of iron & steel supplies and food gained in October. But these advances were not enough to alter the picture of tame prices. Over the year, nonfuel industrial supply prices fell 5.1%, their biggest drop since October 2009 during a recession period.
By country, imports from China posted -0.1%, Japan -0.2%, Canada -1.3%, and Latin America -1.0%. The latter two were led by lower oil prices. The E.U. was the exception to the monthly trend, at +0.5% in the largest rise since February.
Response rates for this data and the reference period were not changed by the government shutdown, so there is no reason to question this data set.
Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.