U.S. import prices increased lower than expected in July, a signal that inflation pressures may have peaked as supply chain bottlenecks impacted the recovery of the U.S. economy.
Source: U.S. Department of Labor
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Import prices increased by 0.3% last month after increasing 1.1% in June. The ninth straight monthly gain led to 10.2% increase YoY compared to 11.3% last month, but it was the lowest monthly increase since November 2020.
Increasing COVID-19 vaccinations, low interest rates, and up to $6 trillion in government aid are fueling demand at the same time as higher commodity costs, lower inventories, and the global shipping container crisis are disrupting supply chains.
Import fuel prices jumped 2.9% last month after increasing 5.5% in June. Petroleum prices rose 2.1%, while the cost of imported foods rose by 0.3%. Core import prices jumped 0.6% in June.
Export prices advanced 1.3% in July after increasing by 1.2% in June. Prices for agriculture dropped 1.7% as the non-agricultural export prices rose by 1.6%.