U.S. Import and Export Price Indices for July, 2006

The U.S. Department of Labor's Bureau of Labor Statistics this morning released the Price Indices for U.S. Imports and Exports for July, 2006 :

Import Prices
Consensus: +0.8%
Actual: +0.9%

Export Prices
Actual: +0.4%

The above percentages represent the month-to-month change in prices for

• Imports: the cost of goods produced in other countries and sold in the U.S.
  
  
• Exports: the cost of goods produced in the U.S. and sold in other countries.
  

Together, these indices offer insight into the status of inflation in the United States, and for the global economy as well.

The "consensus" is what economists and Wall Street forecasters were expecting, while the "actual" is the actual or real figure.

The following is a snippet from today's Labor Department report:

"The U.S. Import Price Index increased 0.9 percent in July, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. A 4.7 percent advance in petroleum prices more than offset a modest 0.1 percent decline in nonpetroleum prices. The price index of overall exports rose 0.4 percent in July following a 0.7 percent increase in June.

Import Goods

Import prices rose 0.9 percent in July, led up for the third time in the past four months by rising petroleum prices. The price index for import petroleum, which advanced 11.3 percent in April and 6.4 percent in May, increased 4.7 percent in July following a 1.4 downturn in June. For the year, petroleum prices rose 29.6 percent. In contrast, nonpetroleum prices edged down a modest 0.1 percent in July after increasing in each of the previous three months. Prices for nonpetroleum imports advanced 2.3 percent over the past 12 months, while overall import prices rose 7.0 percent for the same period.

The small July decrease in nonpetroleum prices was led by a downturn in the price index for nonpetroleum industrial supplies and materials, which fell 0.9 percent following increases of 2.8 percent and 1.3 percent, respectively, in May and June. The drop in nonpetroleum industrial supplies and materials prices was driven by a turnaround in unfinished metal prices, although lower prices for natural gas and building materials also contributed to the July decline. Higher chemicals and finished metal prices, however, served to offset some of the decline in nonpetroleum industrial supplies and materials.

A modest 0.1 percent decrease in consumer goods prices also contributed to lower July prices for nonpetroleum imports. Consumer goods prices were unchanged over the past 12 months.

In contrast, the price indexes for automotive vehicles, capital goods, and foods, feeds, and beverages all rose in July. Automotive vehicle prices increased 0.2 percent for the second consecutive month, and advanced 0.7 percent for the year ended in July. Capital goods prices and prices for foods, feeds, and beverages each ticked up 0.1 percent for the month. The increase in capital goods prices followed a 0.3 percent rise in June, but despite those increases, the index declined 0.4 percent over the past year. Prices for foods, feeds, and beverages rose 3.9 percent for the July 2005-2006 period.

Export Goods

Export prices increased 0.4 percent in July, as both agricultural prices and nonagricultural prices contributed to the advance. Prices for agricultural exports rose 1.9 percent after a 2.5 percent increase in June. Higher prices for wheat, fruit, and soybeans all contributed to the increase. Agricultural prices advanced 1.9 percent over the past year, as the recent increases more than offset lower prices at the end of 2005 and the beginning of 2006. Nonagricultural prices continued a steady upward trend in July, rising 0.2 percent. Over the past 12 months, nonagricultural prices increased 4.6 percent, and overall export prices rose a similar 4.4 percent.

The advance in nonagricultural prices was again led by rising prices for nonagricultural industrial supplies and materials, which increased 0.6 percent. The latter increase was led by higher prices for chemicals, plastic materials, and fuels. However, lower metals prices were an offsetting factor and prices for nonagricultural industrial supplies and materials rose at a smaller rate than in the previous three months, when the increases ranged between 1.7 and 2.0 percent. The index increased 13.5 percent for the year ended in July. Prices for consumer goods and automotive vehicles rose 0.4 percent and 0.3 percent, respectively, contributing to the overall increase in nonagricultural prices. Consumer goods prices increased 2.5 percent over the past year, while prices for automotive vehicles advanced 1.6 percent.

Capital goods prices fell a modest 0.1 percent for the second consecutive month, but increased 0.3 percent over the past 12 months."

Click here to view the full Labor Department report.

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