Indexes are compiled for the prices of goods that are bought in the United States but produced abroad and the prices of goods sold abroad but produced domestically. These prices indicate inflationary trends in internationally traded products. Why Investors Care
| Released on 7/13/07 For Jun 2007 | |||||||||||||||||||||||
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Highlights
Oil continues to drive up import prices, which rose a sizable 1.0 percent in June. But the month-to-month gain is actually a bit lower than prior months including May's increase of 1.1 percent. The year-on-year rate is actually tame at 2.3 percent. Excluding petroleum, import prices edged only 0.2 percent higher in the month though the year-on-year increase is on the steep side at 2.6 percent. This category, non-oil import prices, is closely watched by policy makers.
On the export side, prices rose 0.3 percent and are up 4.1 percent year-on-year. Agricultural export prices are really showing pressure, up 2.9 percent month-to-month and 18.5 percent year-on-year. Milk prices here have been in the news for weeks, rivaling gas prices for headlines in the business page.
Financial markets were moving this morning but not in reaction to these numbers but to surprisingly soft retail trade data. But the weakening dollar combined with strong global demand will make import prices a special focus of concern for Federal Reserve policy makers. Next inflation data will be producer prices and consumer prices next week.
Import prices jumped 0.9 percent in May and were still up 0.5 percent when excluding the month's 2.7 percent jump in import prices of petroleum. But year-on-year rates in May showed less pressure, up 1.1 percent for total import prices and up 2.8 percent excluding petroleum. But more recently, crude oil prices have been rising and the dollar has continued to weaken. Both of these factors are likely to push up import prices in June.
Import prices Consensus Forecast for June 07: +0.6 percent
Range: +0.4 to +1.0 percent
![[Chart]](chart.gif)
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Yearly changes in import and export prices reveal long term trends in inflation for tradable goods. |
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