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U.S. import prices rise less than expected

The price of goods imported into the United States rose by less than expected in December, a government report showed on Tuesday, suggesting a weakening dollar has yet to cause inflation pressures in the economy.
/ Source: Reuters

The price of goods imported into the United States rose by less than expected in December, a government report showed on Tuesday, suggesting a weakening dollar has yet to cause inflation pressures in the economy.

U.S. import prices rose 0.2 percent in December, the third consecutive climb, after increasing 0.5 percent the previous month, the Labor Department said.

Wall Street economists had expected a rise of 0.4 percent.

"The thing I would just note about the import prices is that it just shows that even with a weakening dollar there hasn't been the sort of import price inflation that would cause any sort of concern within the Federal Reserve," said Drew Matus, economist at Lehman Brothers.

Rising petroleum costs helped push up the price of imports. Excluding the 1.8 percent increase in the price of petroleum products, import prices rose just 0.1 percent.

The department said export prices rose 0.2 percent in December, helped by a 1.0 percent increase in the cost of foods, feeds and beverages. The price of meat exports dropped 3.0 percent after rising 1.7 percent in November.

The data will likely reinforce economists' views that the Federal Reserve has little to fear from inflation when deciding monetary policy.

Earlier this month, Fed Governor Ben Bernanke said that while the sluggish U.S. economy appeared to have turned a corner, it was right to hold interest rates at 45-year lows given the low rate of inflation.

Analysts will be looking to a Wednesday report on producer prices and a Thursday report on consumer prices for a more comprehensive picture of inflation pressures. Prices paid by both producers and consumers are expected to have risen 0.2 percent in December, with consumer prices climbing 0.1 percent excluding food and energy.