U.S. Import Prices Decline for Fifth-Straight Month

Import prices have trended down throughout 2015, declining each month with the exception of May and June (U.S. Labor Department).

November was another negative month.

The downward trend is being blamed in large measure to a stronger U.S. dollar and cheaper oil.

Besides fuel, the decline in import prices included foods, feeds, beverages and each of the major finished goods categories. All fell over the past 12 months.

An excerpt from a Dec. 10 Investors Business Daily article provides more details:

Import prices declined 0.4% in November, half of what analysts expected but still the fifth straight monthly retreat. Imported petroleum led the way, falling 2.5% vs. October and 44.5% vs. a year earlier. Overall import prices slid 9.4% vs. November 2014, off recent lows but still a sharp drop.

And it's not just petroleum. Import prices excluding petroleum fell 3.4% vs. a year earlier, the biggest decline since 2009. Blame weak prices for other commodities due to sluggish global demand and a strong dollar. Import prices for Chinese goods slid 1.5%, the most since January 2010. That's significant because the Chinese yuan, despite hitting a 4-year low this week vs. the dollar, has largely kept pace with the greenback in recent years.

The import price data suggest more weakness in the producer price index, as well as the consumer price index. With oil continuing to tumble in December … expect inflation to remain virtually nonexistent for at least the short run.

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