US import prices rebounded more than expected in July amid higher costs for petroleum products and food, but underlying imported inflation pressures remained muted.

Import prices increased 0.4 per cent last month, the Labor Department said on Tuesday (Aug 15). Data for June was revised to show prices falling 0.1 per cent instead of the previously reported 0.2 per cent. Economists polled by Reuters had forecast import prices, which exclude tariffs, rising 0.2 per cent.

In the 12 months through July, import prices dropped 4.4 per cent after declining 6.1 per cent in June. Annual import prices have now decreased for six straight months. The government reported last week that consumer and producer prices rose moderately in July.

The Federal Reserve has since March 2022 raised its benchmark overnight interest rate by 525 basis points to the current 5.25 per cent-5.50 per cent range.

Fuel prices increased 3.6 per cent last month while food prices accelerated 2.5 per cent. Excluding fuels and food, import prices fell 0.2 per cent. These so-called core import prices dropped 0.3 per cent in June.

Core import prices decreased 1.1 per cent on a year-on-year basis in July. They have remained subdued even as the dollar has weakened against the currencies of the United States’ main trade partners this year.

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Prices for imported capital goods edged up 0.1 per cent in July. The cost of imported consumer goods excluding motor vehicles fell 0.1 per cent, declining for a second straight month. Imported motor vehicle prices rebounded 0.3 per cent.

Prices of imported goods from China dropped 0.2 per cent. They have not recorded a monthly increase since October 2022. Chinese import prices were down 2.3 per cent on a year-on-year basis in July, the largest 12-month drop since November 2009.

The report also showed export prices increased 0.7 per cent in July, reversing the prior month’s 0.7 per cent decline. Prices for agricultural exports rebounded 0.9 per cent after decreasing in June and May. Higher prices for soybeans, meat and wheat in July more than offset lower prices for corn, fruit and nuts.

Non-agricultural export prices climbed 0.6 per cent. There were increases in prices for industrial supplies and materials, capital goods and automotive vehicles, which more than offset lower prices for consumer goods and non-agricultural foods.

Export prices fell 7.9 per cent on a year-on-year basis in July, after plunging 11.9 per cent in June. REUTERS