–US Export Price Index Declines For First Time Since July 2010

By Brai Odion-Esene and Ian Mckendry

WASHINGTON (MNI) – U.S. import prices climbed back up in July after
falling the previous month, up 0.3% following a revised 0.6% decline in
June, with rising prices for both fuel and non-fuel imports fueling the
overall increase, the Bureau of Labor Statistics reported Tuesday.

Excluding import prices for both food and fuel, the index only rose
0.2% in July vs. a 0.1% increase in June.

On a year-over-year basis, import prices continued their march
higher, recording a 14.0% increase, the largest since the August 2007 to
August 2008 period, when they rose 18.1%.

Excluding fuel prices — which were up 0.4% on the month following
a 2.1% drop in June — import prices rose by 0.2% in July, and were up
5.5% y/y. The 12-month increase is the largest since the year leading up
to the financial crisis, when non-fuel import prices rose 6.1% between
Sept. 2007 and Sept. 2008.

Rising prices for petroleum (+0.6%) contributed the most to the
advance in fuel import prices. A 48.9% y/y jump in petroleum prices
drove fuel price up 45.5% on the year. In contrast, natural gas prices
fell 3.6% in July and were down 0.9% on a year-over-year basis.

Examining the rise in non-fuel import prices further, higher prices
for consumer goods and non-fuel industrial supplies and materials, up
0.4% and 0.7%, respectively, drove the increase in non-fuel prices. In
contrast, automotive vehicle prices fell 0.3% in July, and import prices
for capital goods remained unchanged.

By region, prices for imports from China rose 0.4%, and was up 3.5%
y/y. The 12-month increase is the largest since it rose 4.3% between
October 2007 and October 2008.

Prices for imports from the European Union rose 0.6% in July and
7.1% y/y.

Import prices from Mexico fell by 0.6% and Canada increase by 0.1%.

The export price index declined for the first time since July 2010,
down 0.4% for a 9.8% gain y/y. Agricultural export prices plunged by
4.3% while nonagricultural exports were up 0.2%.

The report, the only one of its kind done in or out of government,
itself is largely but not entirely made up of monthly price changes
submitted voluntarily by firms, with some items priced quarterly. The
BLS also makes quality adjustments to the price quotes if the product
has been improved.

** Market News International Washington Bureau: 202-371-2121 **

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