US import prices fall by more than expected in July
The cost of goods in the US that were purchased overseas dropped more sharply than expected last month, dragged lower by a fall in imported fuel prices.
Friday's data marked the fourth consecutive monthly drop, the first month-on-month decline of 2022 and the biggest drop since April 2020, said Oxford Economics.
According to the Department of Labor, in seasonally adjusted terms, the country's import price index slipped at a month-on-month pace of 1.4% (consensus: -0.9%), as fuel import prices fell by 7.5%.
Outside of fuel, import prices were off by 0.5%.
Year over year, total import prices were 8.8% higher, against a 1.0% rise in June.
But the US terms of trade worsened a bit, as export prices dropped by more than those for imports.
They were down by 3.3% versus June with agricultural export prices 3.0% lower and those of non-agricultural ones by 3.3%.
In terms of the year-on-year comparison, export prices were nevertheless ahead by 13.1%.
"With a synchronized slowdown in global growth factoring into lower oil prices, we expect import price inflation to remain on a gradual downtrend through the end of the year, barring any unforeseen supply shocks," said Oxford Economics's US economist Mahir Rasheed.
"Rising interest rates and a more modest growth path for the economy will also support slower growth in import prices, especially as domestic demand eases and falls into a healthier balance with supply."