Economic Report: Import prices fall again in October. No inflation entering the U.S. from abroad
The numbers: The cost of goods imported into the U.S. fell sharply in October, reflecting declines in a broad array of goods such as petroleum, food, drinks and consumer electronics.
The import price index sank 0.5% last month, the government said Friday.
If petroleum is excluded, import prices slipped 0.1%.
The price of imports have fallen 3% in the past year, marking the largest decline in a 12-month period since the middle of 2016. That’s made foreign goods such as wine and cheese cheaper for Americans to buy and put downward pressure on inflation in the U.S.
What happened: The cost of imported oil fell 3.7% in October. Prices also fell for foods, beverages, consumer products and “capital goods” — large items such as heavy machinery bought by big companies.
Auto import prices were flat.
U.S. export prices also dipped 0.1%. They’ve declined 2.2% in the past year.
The cost of imports from China decreased 0.1% in October and prices are down 1.6% over the past 12 months. China has sought to counter stiff U.S. tariffs in part by letting the value of its currency fall.
Big picture: Inflation is low in the U.S. and around the world and unlikely to rise much with global economic growth slowing to a crawl this year. While U.S. tariffs have led to price increases on some goods, inflation more broadly hasn’t been affected very much.
What they are saying? The weakness in import prices “is due to the trade war that has taken a toll on global growth and commodity markets,” said Thomas Simons, senior money market economist at Jefferies LLC.