US import prices fall more than expected in March

US IMPORT prices fell more than expected in March, leading to the biggest year-on-year decline since mid-2020, further evidence that inflation pressures are subsiding.

Import prices dropped 0.6 per cent last month after slipping 0.2 per cent in February, the Labor Department said on Friday (Apr 14).

Economists polled by Reuters had forecast import prices, which exclude tariffs, falling 0.1 per cent. In the 12 months through March, import prices decreased 4.6 per cent.

That was the largest year-on-year drop since May 2020 and followed a 1.1 per cent decline in February. It offered more hope in the Federal Reserve’s fight against inflation. The government reported this week that consumer prices barely rose in March, while producer prices fell by the most in nearly three years.

Imported fuel prices dropped 2.9 per cent after plunging 5.7 per cent in February. Petroleum prices decreased 1.2 per cent, while natural gas prices plummeted 31.3 per cent. Petroleum prices are set to rebound after Saudi Arabia and other Opec+ oil producers early this month announced further oil output cuts.

The cost of imported food fell 0.5 per cent. Excluding fuel and food, import prices dropped 0.4 per cent. These so-called core import prices gained 0.3 per cent in February.

Prices for imported capital goods dipped 0.1 per cent in March. The cost of consumer goods excluding motor vehicles fell 0.3 per cent.

The report also showed export prices fell 0.3 per cent in March after rising 0.4 per cent in February. Prices for agricultural exports decreased 1.5 per cent as lower prices for corn, soybeans, wheat and fruit offset higher meat prices.

Nonagricultural export prices fell 0.2 per cent.

SEE ALSO

US producer prices fell in March by the most since the start of pandemic

Export prices declined 4.8 per cent year-on-year in March after falling 0.8 per cent in February. REUTERS