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The
Labor Department said on Tuesday import prices gained 0.2
percent last month after a downwardly revised 0.4 percent drop
in February. It was the first time since June that import prices
rose and the largest increase since May.
The increase, however, was less than economists' expectations
for a 1.0 percent gain. Import prices were previously reported
to have declined 0.3 percent in February.
Prices of imported products were down 6.2 percent in the 12
months through March, the smallest gain since December 2014,
suggesting import deflation was ebbing.
Weak import prices have contributed to holding inflation below
the Federal Reserve's 2 percent target.
U.S. financial markets were little moved by data.
Benign inflation has been a key factor in the U.S. central
bank's policy of gradually raising interest rates even as the
labor market tightens.
The Fed raised its benchmark overnight interest rate in December
for the first time in nearly a decade and policymakers recently
forecast only two more rate hikes this year.
Inflation, both on the consumer and producer levels, has been
dampened by cheap oil and a robust dollar. The greenback gained
about 20 percent against the United States' main trading
partners between June 2014 and December 2015.
Oil prices, however, are showing signs of stabilizing.
Last month, imported petroleum prices rose 6.5 percent, the
first increase since June, after tumbling 6.2 percent in
February. Import prices excluding petroleum slipped 0.2 percent
after dipping 0.1 percent in February.
Non-petroleum import prices have not increased since March 2014,
underscoring the impact of the dollar's strength. But the dollar
has depreciated 2.6 percent on a trade-weighted basis so far
this year.
Imported food prices fell 0.6 percent last month, while prices
for industrial supplies and materials excluding petroleum were
unchanged.
Prices for imported capital goods dipped 0.1 percent and the
cost of imported automobiles edged up 0.1 percent. Prices for
imported consumer goods excluding autos fell 0.3 percent.
The report also showed export prices were unchanged in March
after declining 0.5 percent in February. Export prices were down
6.1 percent from a year ago.
Export prices for industrial supplies and materials rose 0.7
percent. Prices for food exports fell 2.5 percent.
(Reporting by Lucia Mutikani; Editing by Paul Simao)
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